Photo: RNZ / Samuel Rillstone
A proposed tax change will affect people who have solar power on their roofs, and sell power back into the grid.
Revenue Minister Simon Watts said on Tuesday he had introduced a new tax bill aimed at boosting New Zealand's economy, helping businesses grow, and making it easier for skilled people to live and work here.
The bill includes changes so that new migrants are only taxed on money they earn overseas, not estimated income they do not receive.
It also makes it easier for overseas visitors working remotely to stay here longer before they are taxed.
It addresses tax timing issues with employee share schemes and includes GST changes for joint ventures.
It will also introduce a change so that people who export excess power from their solar power systems will not face income tax on that money.
Revenue Minister Simon Watts. Photo: RNZ / Samuel Rillstone
The bill noted Inland Revenue thinks tax compliance among people with solar power systems is low, perhaps because they are not aware the income should be taxable.
"However, in many cases, the compliance costs associated with these obligations are likely to be disproportionately high compared with any tax revenue gained. This is because most individuals would not normally need to file tax returns as all their income has tax deducted at source from salary, wages, or investment income. High compliance costs may also arise from apportionment issues due to the private limitation on deductions.
"It would be resource-intensive for Inland Revenue to monitor compliance among these individuals. It is also likely that many individuals would be in a tax loss position due to their expenses (for example, the cost of solar generation assets) outweighing any income."
Watts said change should also encourage more solar uptake.
The bill proposes the exemption would apply to power sold from residential properties to networks.
But the customers would also no longer be entitled to any tax deductions relating to their solar power activity.
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