Compliance costs on the controversial tax on employees'
car parks and technology provided to workers by employers has
led to them being dumped, WHK tax principal Scott Mason says.
''It is the Inland Revenue Department's job to come up with
these things. From a policy perspective and fairness, there
is a fair gap and some people have been taking advantage of
''The Government has looked at the compliance costs, and the
message the tax sends, and decided it's not worth the
hassle,'' he said.
Prime Minister John Key said there was virtually no chance of
the technology tax going ahead.
Labour Party revenue spokesman David Cunliffe said the plans
for the ''petty tax'' on iPad and cellphone use was another
embarrassing back-down by the Government and another slap
down for Revenue Minister Peter Dunne by Mr Key.
''The National-United Future confidence and supply agreement
lies in tatters. What has Peter Dunne left to contribute? His
tax ideas are petty penny-pinching and completely passe.''
Employer groups, unions and others who opposed the car park
tax through the FBT Action Group estimated it would set back
businesses about $30 million in compliance costs for revenue
of just $17 million a year.
Mr Mason said the Inland Revenue Department had been looking
at the ways in which cellphones, computers, laptops and
tablets were being used. There was a general exemption on
work tools worth less than $3000.
''The problem is with any exemption, there are ways to get
other benefits. You get employers saying you need to take a
pay cut, but we will give you a cellphone. There is a bit of
wage and salary substitution going on.''
The same logic had been applied to the car park tax but the
Government had realised the administration costs of
collecting $17 million were greater than that, Mr Mason said.
There would be some private use involved in the issue of
technology, but compliance costs would be high to collect the