Pay it back

New Zealanders generally believe in paying their fair share as they go through life.

Most regard social welfare as a hand up, not a hand out, and we pay our tax within the rules set down by the Government and the Inland Revenue Department.

The issue of fairness around tax arises from a threat by Inland Revenue to bankrupt former students living in Australia who are refusing to repay loans.

Tax staff have cracked down on hundreds of student loan borrowers in New Zealand and are moving their enforcement across the Tasman.

The plan would mean the IRD could get a New Zealand court judgement transferred to Australia, where it would be then enforced. Measures could involve charging orders on a property, deducting money from a person's salary, seizing assets such as vehicles, and even forcing them into bankruptcy.

The same system is being planned for borrowers living in Britain.

For people with student loans living and working in New Zealand, the system is relatively straight-forward.

The loan is repaid through the PAYE system, with the interest on the loan being rebated at the end of the year. Self-employed people get a bill at the end of each year to pay.

Those with loans working overseas are expected to pay off their bill in instalments four times a year.

However, some are opting not to pay, instead enjoying the luxury of a taxpayer-funded education in New Zealand without repaying that generosity by either working in this country or repaying the loan and interest.

Tax professionals see bankruptcy as a last option; the ultimate threat, as it were.

The IRD will be more interested in getting the money than forcing someone into bankruptcy and receiving none of the loan.

It is possible now for a student with a large loan to finish a degree and declare him or herself bankrupt and, without assets, have the loan wiped.

But someone working professionally overseas could face obstacles in continuing employment if they were declared bankrupt by the IRD.

Therefore it is in their best interests to come to some agreement with the IRD and repay the loan.

While it may seem a good scheme to chalk up a student loan of perhaps tens of thousands of dollars for a degree and then move overseas, it smacks of being ungracious and deceitful to avoid repaying the faith New Zealanders placed in such students.

With compounding interest, it is not unreasonable to think that after 10 years overseas a $100,000 loan could balloon to more than $250,000.

That in itself will be a disincentive for people to move back to New Zealand and make their contribution.

It was disappointing New Zealand Union of Students' Associations president Pete Hodkinson led opposition to the plans to track down overseas residents with outstanding loans and make them pay. "Extreme measures about to be taken to chase down New Zealand graduates who are gaining overseas experience are symptomatic of a Government that is prepared to treat graduates as if they were in the same category as tax-evading criminals or worse," he said.

While those graduates gaining overseas experience are not criminals, they certainly are - in some cases - tax evading. The solution for such graduates is simple: pay the money back so others can enjoy the same benefits you enjoyed.

And another thing

Lion brewery's planned $29 million investment in Dunedin's Speight's Brewery as detailed late last week is good news for the city.

It appears the right mix of heritage protection and modern redevelopment has been found and, in such straitened times, the employment of (at times) between 60 and 100 workers during construction, and 27 permanent brewery staff as compared with 11 before the Christchurch earthquakes, is to be welcomed.

And people worried about emissions from Speight's chimney during recent months will no doubt also be pleased that cleaner and greener methods will be adopted - the sooner the better.