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The tax man is coming for you
The tax man is coming for you

18 July 2024, 6:01 PM

The tax department got $29 million in the budget this year - $116m over four years - to collect tax from people who should be paying it, but aren't. IRD has just released its list of targets and it's a broad one, spanning everyone from students, criminals, shop owners with electronic ways to cheat the system, sole traders whose books are a mess, cleaners, gardeners, landlords, and people who try to avoid banking systems by using cryptocurrency.But top of its list is the construction industry, a sector long associated with the proliferation of the "cashie". We look at how Inland Revenue plans to pull in an estimated extra $702m using its new resources; and why the construction industry feels a bit hard done by when it comes to assumptions about how builders do business.RNZ money correspondent Susan Edmunds says IRD gets nearly 7000 anonymous tip-offs a year about cash jobs, and the construction industry is the most often reported.  "There's been a focus for several years there and [IRD is] just amping that up a bit," she says. Construction "has had a big downturn just lately, so probably from some businesses' perspective this isn't a great time for a crackdown. But they have been signalling for some time that it's coming".The industry has been struggling with economic hard times, an increase in insolvencies, unavailability of materials and hugely increased costs, and Edmunds says IRD acknowledges that.  "But they say that some are just actively avoiding their obligations, and those are the ones that they're going for."IRD says it will use the [budget] money on tools and people to get its audits done, and accountants and tax experts say they expect to see a real step-up in activity, and everyone should be working to get their paperwork in order," she says. "They say they took a 'softly-softly' approach during the pandemic but that's now changed." Auditors have started to do site visits looking for the missing millions, which Edmunds says might be alarming for some people.  But 40,000 construction companies have outstanding debt, overdue tax returns or both. IRD will text 2500 of them asking if they want support to get their outstanding tax sorted. That includes the portion of people who owe GST to the government - GST debt has risen from $1.9 billion to $2.6 billion in a year. "You might have to think that's probably businesses using that money to keep themselves afloat rather than paying their GST as they should," Edmunds says.  New Zealand Certified Builders Association chief executive Malcolm Fleming says there's irritation amongst professional builders that tradies always come up in conversations about those who don't pay their tax. "Hundreds of thousands of people are employed in the construction industry in New Zealand and the majority of them are good commercial operators, running projects through their books and paying their share of tax to New Zealand Inc," he says. Legally all building work with a value of more than $30,000 must come with a contract, and that leaves a paper trail. It is work under that amount where the "hidden economy" is often found. In 2018 the Tax Working Group did a report on the hidden economy and concluded that the most common activity was the underreporting of taxable income - through activities including cash jobs, not declaring rental income, or skimming transactions. Fleming says as the construction industry constricts thanks to economic restraints, bigger building firms are turning to smaller jobs, and are discovering this for themselves. He says some education is needed - "There really needs to be a bit of a plea to the general public, or homeowners, to ensure that they go to a professional builder. Homeowners aren't going to their accountant, or their dentist, and asking for cash jobs, but they seem to think it's a way to go with tradies. "For those professional builders, who are the majority, it's really annoying if they miss out on a job due to somebody who is providing a cash option. "I think there needs to be a shift in the mindsets of the general public in their approach to asking tradies, or anyone else for that matter, 'what is the cash equivalent?'" 

Local board agreement funds Rodney projects
Local board agreement funds Rodney projects

17 July 2024, 8:26 PM

Rodney’s parks, libraries, arts centres, rural halls, and community centres will benefit from a $15.2 million investment for the financial year 2023-2024. The Rodney Local Board agreement, adopted in June, outlines key funding priorities for the next year.An additional $10.2 million has been allocated for capital investment in the area. Board chair Brent Bailey acknowledges the challenges faced by elected members, particularly in recovery efforts following Cyclone Gabrielle. “It will take tremendous effort and investment to rebuild our damaged infrastructure, road networks, parks, and community facilities,” he said.The board’s recovery office is working on acquiring high-risk properties, and healthy waters staff are implementing the Making Space for Water programme to build resilience against extreme weather events. Bailey noted the financial burden on ratepayers and emphasised a pragmatic approach to delivering projects.Key initiatives include overseeing Rodney’s full facilities contracts, improving open spaces, streetscapes, and townships, supporting arts centres and extending arts outreach, holding more children and youth programmes at council facilities, and supporting community centres in east Rodney.Bailey highlighted the board’s ongoing advocacy for better maintenance of rural roads, public transport, and community facilities in response to significant growth in Kumeū, Dairy Flat, and Warkworth. He thanked residents for their feedback, with 1,038 submissions received, showing strong support for the board’s priorities.The agreement is available online at aucklandcouncil.govt.nz

Final $50m Powerball winners claim prize
Final $50m Powerball winners claim prize

16 July 2024, 10:15 PM

The final winners of Lotto's $50 million must-be-won draw have claimed their portion, saying they will be able to look after their family for generations.The draw took place on 8 June, but the Auckland couple, who wanted to remain anonymous, took more than two weeks to check their ticket.Seven winners split the $50m, meaning each winner received $7.18m.In a statement from Lotto, the couple said they occasionally purchased Lotto tickets - but decided to pick up a ticket for that special draw as it had to be won.But after the draw, they did not pay too much attention to the result and were unaware a winning ticket was sold at the store they had purchased from."Because we don't buy tickets all the time, we usually only check our tickets when we remember to - we weren't in a rush," the man said.Weeks later, the man decided to check his ticket which was still in his wife's handbag. Scanning the ticket, the app told him he had won a major prize and to take the ticket into a store."I wasn't sure how much I'd won … but I had a feeling that it was a big amount."The next day before completing a grocery shop, the couple discovered they had won $7m."We were so excited," the man said.A family meeting was called to tell the couple's children about the win later that day.One of the children told Lotto they thought something serious had happened - because being asked to get together so quickly was unusual."We all sat around the table waiting and that's when they told us they had won $7m with Powerball. We were all so excited for them."There were lots of tears for sure. They've worked incredibly hard all their lives for us, they really deserve this," the couple's child said.The couple's children wanted them to do something special for themselves - like an overseas trip and finish renovations to their home.But the man said it was all for his kids."It's all for them - everything has been. It means so much to know that my family will be looked after."

Milldale neighbourhood centre nears completion
Milldale neighbourhood centre nears completion

16 July 2024, 8:31 PM

The highly anticipated Milldale Neighbourhood Centre, located at 2 Henry Tayler Rise, has reached the final stages of development, with fit-out teams now working on preparing the various stores for opening.Residents of Milldale can look forward to a diverse range of shopping options, with Pizza Hut set to be the first store to open its doors in early August.Other businesses will follow suit, offering a wide range of services and products.Scott Kennedy from Broadway Property Group, the developer behind the project, highlighted the centre's features, including ample car parking, spacious footpaths, and a diverse array of amenities tailored for all local residents.A stones throw from the Primary School and opposite the Waterloo Reserve, the centre is an easy walk from completed stages, and will feature a large café, dairy, real estate offices, a nail salon, and multiple takeaway options, catering to a wide range of tastes and needs.The influx of new stores is expected to provide a significant boost to the local economy and job market, a development that is sure to be welcomed by residents and business owners alike.Broadway Property Group, with its 30-year track record in building and managing quality commercial properties, plans to begin construction on a complementary development opposite the site by the end of 2024.This new project is anticipated to take approximately 12 months to complete, further enhancing the community's amenities and solidifying the centre's position as a vibrant retail hub.

Auckland Transport introduces 7-day fare cap
Auckland Transport introduces 7-day fare cap

16 July 2024, 12:45 AM

Auckland Transport is set to introduce a 7-day fare cap of $50 for public transport users, offering price certainty for Aucklanders who regularly use buses, trains, and inner-harbour ferries. From July 21, commuters and explorers alike can enjoy unlimited travel for a fixed weekly price. The fare cap applies to services including Devonport, Bayswater, Birkenhead, and Onewa Northcote Point inner-harbour ferries.AT HOP cardholders using eligible services will automatically qualify for the fare cap, with no additional sign-up required. The 7-day period starts from the first tag-on, and all trips within that period will count towards the $50 cap. Once the cap is reached, users can enjoy free travel until the period ends.However, monthly ferry pass holders should note that the fare cap does not apply to bus, train, or inner-harbour ferry trips that start or end in a zone included in their monthly ferry pass. For instance, if a customer has an outer-harbour ferry monthly pass that they normally use on the Gulf Harbour ferry and takes a bus from Hibiscus Coast to Warkworth, the bus travel will not count towards reaching the fare cap and the bus travel will not be free once a customer has reached the fare cap as the bus travel started in a zone in which is included in the ferry monthly pass.This new fare cap replaces the $20 daily fare cap and monthly bus and train passes, which will no longer be available for purchase from July 21. Monthly ferry passes remain available, and activated bus and train monthly passes can still be used until they expire.

Stronger stance on unruly Kāinga Ora tenants
Stronger stance on unruly Kāinga Ora tenants

15 July 2024, 6:26 PM

Certain Hibiscus Coast residents may see a positive shift in their communities as Kāinga Ora adopts a stricter approach to managing unruly tenants. Housing Minister Chris Bishop and Associate Housing Minister Tama Potaka announced the changes, highlighting the government's commitment to ensuring tenant accountability."For far too long, a small number of Kāinga Ora tenants have ridden roughshod over their neighbours because, under Kāinga Ora’s previous Sustaining Tenancies Framework, people knew there were no consequences for their threatening, abusive or damaging behaviour," Mr Bishop said.In March, the ministers instructed Kāinga Ora to end the Sustaining Tenancies Framework and strengthen the management of disruptive tenants. Since then, 14 tenancies have been terminated for disruptive behaviour or persistent rent arrears, with 25 additional termination applications awaiting decisions by the Tenancy Tribunal. This is a significant increase compared to only eight tenancies terminated for such reasons in the whole of 2023.Kāinga Ora has issued 80 formal warning notices for disruptive behaviour in the past three months, compared to just 13 in the same period last year. The new Tenancy Management Framework, including a Disruptive Behaviour Policy, aims to balance the responsibilities of tenants and the rights of the community to quiet enjoyment of their homes.“At a time when we have around 24,000 whānau on the social housing waitlist and more than 2,000 whānau living in emergency housing motels, we will not look the other way when people abuse the privilege of living in social housing," Mr Potaka added."The message to Kāinga Ora tenants is clear: if your actions are causing your neighbours to live in fear and misery, your time is up. Change your behaviour now or face the consequences," Mr Bishop emphasised.

Brown advocates for more infrastructure spending
Brown advocates for more infrastructure spending

14 July 2024, 7:43 PM

Auckland Mayor Wayne Brown recently discussed the city's infrastructure and economic development in a YouTube conversation with economist Shamubeel Eaqub. The conversation covered key issues such as infrastructure spending, financing, and planning, with Brown emphasising the need for significant investments to support Auckland's growing population.During the conversation, Mayor Brown highlighted the necessity for Auckland to increase its infrastructure spending to accommodate the growing population. "We must invest more in public transport, including rail, and ensure we get better value from our existing assets," he stated.Brown was critical of the current financing system, which relies heavily on rates. He suggested adopting a value capture approach, where beneficiaries of infrastructure projects contribute to the costs. "Auckland Council should set up a wealth fund to support future infrastructure projects," he proposed.The Mayor also criticised the slow and bureaucratic planning process, advocating for more central government investment in Auckland and greater use of economic principles in decision-making. He expressed concern over Auckland's treatment by the central government in Wellington, arguing, "Auckland generates more tax revenue than it receives back."The discussion underscores the ongoing debate about how best to manage Auckland's growth and the need for strategic investment in its infrastructure.Watch the video below.

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