'iPad tax' ruled out

Less than 24 hours after Revenue Minister Peter Dunne's carpark tax was dumped, his proposed "iPad tax"on work smartphones laptops and tablets is also now dead in the water, according to Prime Minister John Key.

"I think there's virtually no chance of it going ahead", Mr Key told reporters this afternoon.

Mr Key's comment follows remarks from Mr Dunne that he expected stronger opposition to the tax than the proposed tax on inner city employer- provided carparks.

Mr Key said the laptop tax was "a nice idea when it comes to tax policy, but a pain in the neck for everyone that has to put up with it".

Mr Key's comments continue a bruising week for Mr Dunne who announced the backdown on the carpark tax yesterday afternoon just hours after defending it on the grounds of fairness.

Employer groups, unions and others who opposed the carpark tax through the FBT Action Group estimated the it would set back businesses to the tune of about $30 million in compliance costs for revenue of just $17 million a year.

But Mr Key yesterday said advice from officials was that compliance costs would be just a 10th of what the group estimated.

"Not $30 million, maybe $3 million, but what the officials said was that it's very subjective, so it could be a bit more, it's hard for them to absolutely know.

But the Employers and Manufacturers Association which led the charge against that tax said it would also campaign against the cellphone and laptop tax.

Labour's revenue spokesman David Cunliffe said the compliance cost relative to the amount that could be raised through the laptop and phone tax was likely to be higher than the compliance cost of the carpark tax.