Nelson Mail

Businesses shocked by ‘terrible’ letter from IRD

- Skara Bohny skara.bohny@stuff.co.nz

Inland Revenue wants business owners affected by recent events like the flooding in Southland to know that they still need to pay tax.

A form letter from the Inland Revenue Department (IRD) titled ‘‘Good books = good business’’, supplied to Stuff, says the IRD knows ‘‘how hard it can be’’ in the ‘‘competitiv­e’’ accommodat­ion industry, and that ‘‘recent events such as the Southland floods and Coronaviru­s travel restrictio­ns haven’t made it any easier’’.

But the main thing the department wants affected business owners to know is that they still need to pay their taxes.

The letter begins by saying that anyone who is having trouble meeting their tax obligation­s should contact the IRD ‘‘as early as possible’’. It goes on to say that ‘‘it takes a lifetime to build a good reputation, but you can lose it in a minute’’.

‘‘Building your reputation takes effort and care. And keeping good business records is a big part of that even in hard times,’’ the letter says.

‘‘We recognise how much you and others in your sector contribute to New Zealand and that you’re facing many challenges. But recent tax evasion cases involving a national restaurant chain and a Waikato baker prove that some business owners deliberate­ly break the rules to pay less tax on their profits. They create an uneven playing field and are now facing the consequenc­es.

‘‘We know the signs of businesses that aren’t following the rules. If business owners are underrepor­ting sales, paying under-thetable wages, or under-paying GST, we’ll find out. It’s breaking the law and we will prosecute.

‘‘If you know someone who’s not doing the right thing, you can let us know confidenti­ally.’’

Towards the end, the letter admonishes business owners to ‘‘remember, making a false return is a crime, so if you’ve got something to declare, let us know’’.

A business owner in the tourism industry said it was a ‘‘terrible, terrible email’’, and it was so unlike his normal interactio­ns with Inland Revenue that he at first thought it must have been a fake.

‘‘I have a reasonable amount of dealings with the IRD . . . they are so profession­al, they are so compassion­ate, they’re incredibly accommodat­ing, they answer questions, they’re accountabl­e, and this is so diametrica­lly opposed. Is this real?’’

The business owner, who wished to remain anonymous, said the letter was ‘‘scummy’’ and ‘‘inappropri­ate’’.

‘‘To cite those other things, which will be hot-button items to huge swathes of tourism operators who are facing ruin, it struck me as being so odd.

‘‘The timing is just shocking . . . we’ve got a GST payment coming up, which for most people is for the two biggest months of the tourist season, so to say ‘Look, you may have trouble paying this, there may be a problem with this’ – forget ‘Dob your mate in and fix your mistakes’ – then it would have been seen as a compassion­ate letter,’’ he said.

IRD senior media adviser of marketing and communicat­ions Gay Cavill said the department ‘‘won’t be doing an interview on this’’, but offered a written statement. The statement had not been received at the time of publicatio­n.

‘‘Is this real? . . . To cite those other things, which will be hotbutton items to huge swathes of tourism operators who are facing ruin, it struck me as being so odd.’’ Tourism business owner

 ??  ?? An IRD form letter to businesses affected by floods and coronaviru­s travel restrictio­ns warns them to pay their taxes or face prosecutio­n.
An IRD form letter to businesses affected by floods and coronaviru­s travel restrictio­ns warns them to pay their taxes or face prosecutio­n.

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