IRD chasing students, not speculators

Newsroom report that IRD have 64 staff dedicated to chase up student loan repayments from people who have moved overseas, and none working solely on property speculators who ignore the bright line test.

I don’t think it is this simple, but this does look like a system slanted against students and easy on speculators.

Newsroom: IRD chases students while speculators go free

In spite of the bright-line test having an incredibly low compliance rate, Inland Revenue has no full-time staff chasing property investors who fail to pay what they owe.

The test, which came into effect in late 2015, is designed to crack down on property speculation by automatically taxing profit made on the sale of residential property (other than the main home). Initially it applied to property sold within two years of purchase but earlier this year the Government passed legislation extending it to property sold within five years.

Nearly one in three eligible property investors fails to comply with the test and documents released to Newsroom under the Official Information Act show the compliance rate is worsening. A report given to Revenue Minister Stuart Nash in May estimated bright-line test compliance could be lower than 50 percent. 

Despite this, the IRD has not, in the three years since the bright-line test was implemented, established a team for chasing non-compliance and recovery.

Information released under the OIA to Newsroom said the IRD did not have dedicated teams for bright-line recovery nor did it have a separate budget for bright-line recovery activity. Instead existing staff were used to track down people who had not filed a return for possible tax due under the bright-line test.

In contrast:

This stands in stark contrast to the student loan system, which has 64 staff chasing borrowers who have moved overseas and are behind on their repayments. The team had a budget of $2.245 million for the period July 1, 2017 to January 2018.

This sits on top of more than 3000 staff across IRD involved in some way with compliance activity and debt recovery, including chasing overdue student debt.

The 64 staff employed by the student loan team are “predominantly” tasked with tracking down more than 75,000 overseas borrowers who collectively owe $1.2 billion dollars, according to the latest report from IRD. 

Tax on property speculation is a part of whole tax obligations for those dealing in property, so could be picked up through general tax checks, but it does seem odd that more focus isn’t put on it, given the current and last Governments’ talk on cracking down on property speculation.

Some of the silliest speculation

The secrecy in government forming talks seems to have been very effective – political journalists seem to have had few if any leaks to work with. This seems to have frustrated them big time, they don’t like being excluded from the gaming.

So all they have had to write about who is arriving at and leaving meetings, the lack of progress, and speculation.

The speculation covers things like possible governing arrangements – Winston Peters has claimed their are nine possibilities, with no indication which may be preferred or more likely – and also possible policy agreements and ministerial positions.

Trying to second guess Peters is a mugs game. There are indications he doesn’t know things himself, given his time line assurances that have proven quite inaccurate.

After yesterday’s NZ First board meetings and then ‘secret’ meetings between Peters and Bill English, and separately with Jacinda Ardern, gave up nothing of substance some the speculation seemed to get sillier.

Audrey Young: Winston’s two offers: Why it could get personal

Which ever party leads the Government, New Zealand First could expect an unsolicited electoral arrangement in 2020 to assist the party’s survival in Northland or Whangarei – which would never be spoken of.

It would simply be in both parties’ interests.

Tracy Watkins: Coalition talks gather pace with secret meetings

With the policy discussions out of the way, those talks are likely to centre on ministerial portfolios, the structure of the next government – are the Greens in or out for instance – and assurances about 2020.

In National’s case that would likely require cast iron assurances that it will not try to kill NZ First off again – as it very nearly did this time round, when it ran its “cut out the middle man” campaign.

Future assurances might include an acknowledgement that NZ First is first cab off the rank in any future coalition deals – maybe even back channel commitments about an Epsom-style deal in Northland.

I think it would be utterly ridiculous to try to get commitments on the next election campaign, let alone coalition negotiation terms in future terms.

Many things could happen in the next two and a half years that could change things. One likely possibility is that Peters won’t stand again, so any assurances to him would be worthless.

Promising not to compete in a future election would be preposterous and an insult to democracy.

If either National or Labour formed a government now based in part in promises about not competing or assisting in the next campaign, and this government fell apart (and Peters has history on not lasting out a term in coalition) any governing party that was then seen to do a deal with NZ First in advance of the next election would be at high risk of being punished severely by voters.

The Memorandum of Understanding between Labour and Greens turned out to be ill advised and fell to pieces after competing power plays leadership changes. And it doesn’t seem to have done the Greens much good, appearing to have been shunted to the sidelines by Peters, aided and abetted by Labour.

Assurances by Peters have proven to be unreliable – except that one thing he has staunchly stuck to is not indicating any preference for any other party in election campaigns.

For him to make an agreement to cosy up to one or the other of Labour or National in the next election seems as likely as him campaigning in shorts and t-shirt.

In the absence of actual news speculation is bound to fill the vacuum, but it seems to be getting sillier as the limbo period continues.

Prentice ignores lawyer advice on suppression

Lynn Prentice has graced us with an abusive hypocritical moan that suggests he is ignoring legal advice.

You were advised that we have no particular responsibility to limit speculation. We will stop people saying that a particular person was the cabinet minister or that their brother is the subject of the charges. That is, as far as I am aware, all that the suppression order states.

I’d take a bet that you have no further information on the suppression order yourself. It is a problem with the way that suppression orders are advised.

That was advised to the commenters in the comment stream where the speculation went on, and has been conformed with. In this case the court managed to spread speculation over a very limited number of Cabinet Ministers and their brothers because they did not or (more likely) could not cover the publication of the profession of the Cabinet Minuster – which the SST published.

Basically you are an lying arsehole who has no compunction in twisting words, be it emails, legal, or site policies. But what else do we expect from such an bullshitting illiterate…

Lynn,you have a very strict rule, strictly enforced, that no one at The Standard is allowed to attack or or abuse authors. Isn’t it somewhat hypocritical that you practice what you preach against?

But ignoring your wee character tirade (which is typical of your blog manners), how are you aware of what the suppression order states? Yesterday I thought you said you had no way of knowing. Here its is:

So to conform to the reported suppression, I will just limit people saying explicitly which minister it is.

I also note that there has been nothing reported about the alleged victims seeking suppression.

You seem to contradict yourself there with ” the reported suppression” and then “here has been nothing reported”. I don’t know how you can make a legally safe stance from that.

There has been opinion elsewhere about what what speculation that media should and shouldn’t allow in publications and comments. Like:

While suppression is in place, please do not speculate in the comments.  Doing so will earn you a permanent holiday.

I’ve quite often seem warnings like that, but I presume you won’t take much notice of what Whale Oil says.

What about this blogger/lawyer?

Please note suppression orders are in place.  There should be no Speculation on who this (person) is.

They carefully edited this comment:

Ever noticed how illiterate [Please be careful] writers can be while having an air of intellectual superiority in what they write?

I was googling blogs and found this

[Please be careful] report went virile and received over 700,000 views in a few days after its release. ”

And another author on that same blog:

it should be obvious that anything that identifies the person subject to the suppression order is not permitted. You’re bordering on wasting author/mod time, bud.

They sound quite definite about it.

And when someone asks “Mods with the blog site involved currently online including a recent update what is the consensus on linking to the site concerned? The lawyer urges caution:

Best not to. The treatment of name suppression is a valid topic of discussion but reinforcing the breach is not.

And the other author:

I imagine that would be a breach of the suppression order, which would put TS in legal jeopardy. Not a sensible course of action. I also note that the post specifically asks for there to be no speculation. That should be enough in itself.

Maybe Prentice doesn’t agree with Greg Presland and ‘Te Reo Putake’ either. So what about this view?

Simply put, if we don’t know what the suppression was on, then we can’t know what needs suppressing. So we act as if all such pointed speculation is someone trying to put us in the dock.

Court suppression orders are nothing to fool with. We don’t know what evidence was placed in front of a judge to cause them to issue the suppression order, so we don’t speculate.

I have a pretty basic rule. It says that if I see anything that might make a judge look at me and think that I may have deliberately allowed the name suppression to be violated, or that causes us problems with our privacy rules (ie having to give up some persons details) – then it is a problem.

Then I will act against the person involved immediately and rather ruthlessly to make sure that they never want to do that to us again. Other moderators may be kinder and simply cut out the offending passages.

Lynn, do you agree with that? It seems to be quite different to what you are claiming now. Or do you just make up your standards to suit who you are trying to be vindictive to?

Cunliffe and Parker repeat claims on property speculation

Both David Cunliffe and David Parker have repeated claims that capital gains on property speculation is not taxed. They are wrong again.

David Cunliffe in speech to Young Labour:

We have too many children who are getting sick because they live in cold, damp, cramped houses with black mould growing up the walls. Sometimes owned by speculators who just push the rent up while getting rich on tax-free capital gains.

David Parker on The Nation:

“You need to tax the speculators….capital gains tax”
“Loan to valuation ratios would not be needed if they were taxing speculators and building affordable homes.”
“National Party, despite the fact that we had 40 percent house inflation, they’re not doing anything about it. Not taxing speculators…”

Inland Revenue:

Dealers and speculators must pay income tax on any gain they make from reselling their property.

Cunliffe has made similar claims several times this month, including in Parliament. He has been corrected.

Parker has made similar claims over the past year, including multiple times in Parliament, He has been corrected multiple times.

It can’t be through ignorance.

It looks like deliberate attempts to mislead the public.

Details at Politicheck: Property speculators are taxed