Inland Revenue has hired an American company to lead a major overhaul of its information technology system.
Cabinet has approved $193 million for the project but that is expected to grow to up to $2 billion.
Inland Revenue today announced it has chosen Fast Enterprises to design and supply the software for the new system.
Deputy Commissioner of Change Greg James said that software would eventually replace the current system, which would modernise New Zealand's tax system.
He said Fast Enterprises had a good track record, and they hoped the project would get under way in July.
"They have delivered consistently on every project they've entered into. In most cases, they've delivered ahead of time, and on budget, so absolutely the right partner to be investing in."
The Office of the Auditor-General warned earlier this month that the project could not afford to fail.