Debts on tax Soaring in NZ

NZ Herald reports today that the latest tax report from Inland revenue shows staggering debt figures for the future.

Tax debt climbed to $4 billion by the end of June last year and Inland Revenue says it could more than double within the next five years.

A report into tax debt released by the Auditor General said the growth rate is more than the department can handle with its current procedures.

"[The IRD] is proposing to better understand taxpayers, provide taxpayers with improved online tools, and pilot new approaches designed to enhance its processes for collecting tax debt," Auditor-General Kevin Brady said in his report.

Tax expert from accountant firm PricewaterhouseCoopers, John Shewan, said the debt increase is due to a variety of factors including the current economic climate, IT systems and new programmes being introduced.

He said KiwiSaver, Working for Families and student loans have all been added to the IRD's portfolio in the past nine years.

Shewan said the amount of tax collected has increased."It's like running a business, isn't it? If you increase your sales, you'll get more debtors and your bad debtors will go up," he said. Read More