Tax Policy Bulletin

Election campaign enters its final weeks

With the 2026 General Election approaching on 7 November and advance voting starting on 26 October, political parties have continued to announce their final policy commitments. Both National and Labour have also released their fiscal plans earlier this month, outlining how they intend to fund their election promises. Other political parties have also outlined their tax and economic proposals. We outlined most of these in our election policies Tax Tips in September, however some noteworthy announcements have been made since:

• ACT has announced plans to remove tax on KiwiSaver investment earnings while ending Government contributions, abolish residential rental loss ring fencing and remove the charitable donations tax credit cap.
• The Greens released an economic development plan proposing to redirect Investment Boost towards investment aligned with their economic and environmental objectives.
• Labour released its fiscal plan on 4 October, forecasting a return to surplus in 2028/29. The plan outlines how Labour intends to fund its election commitments, including revenue from its previously announced capital gains tax and the proposed repeal of Investment Boost – although they have clarified that Investment Boost would apply until 30 June 2027 (around 49:30 in the recording). They have also announced they would not reverse interest deductibility for residential investment property, and clarified their intention to increase employer KiwiSaver contributions to 6%.
• National released its fiscal plan on 12 October, also targeting a surplus in 2028/29, while prioritising debt reduction and maintaining its commitment to no new taxes. National has ruled out immediate income tax cuts but indicated that future tax relief could be considered once the Government's books return to surplus. Its recently announced small business plan also includes reviewing the $60,000 GST registration threshold and retaining Investment Boost.
• New Zealand First has proposed increasing Working for Families assistance, small business tax reforms including a reduced 20% rate for companies with turnover below $30 million similar to Australia’s dual corporate income tax rate system. They have also announced a policy to increase KiwiSaver contributions to 8% and eventually to 10%, as well as an immediate $1,000 Crown contribution for New Zealand citizens and compulsory enrolment at birth.
• Opportunity announced its five coalition bottom lines, including stronger competition regulation and a ten year health funding plan. The party’s bottom lines did not include its proposed land value tax and Citizen's Income.

Other recent announcements

• Taxation (Annual Rates for 2026–27, FBT Simplification, Foreign Investment Funds, and Remedial Measures) Bill Information release.
  • This information release includes Cabinet papers and supporting advice relating to the development and introduction of the September tax Bill. Published 8 October 2026.
• CSUM 26/12 Taxpayer required to pay GST on insurance sum.
  • This case summary considers a High Court decision on whether an insurance payment received for losses incurred in the course of a taxpayer's taxable activity was subject to GST. Published 9 October 2026.
• CSUM 26/13 High Court holds s 19(3B) of the GST Act overrides s 19A(2); and whether registered person ceased to satisfy s 19A(1) requirements is determined at date of notification.
  • The plaintiff companies challenged the Commissioner’s decision not to direct them to account for GST on the invoice accounting basis under s 19A(2) of the Goods and Services Tax Act 1985 (GSTA).
  • The liquidator said he was required, under s 53(1)(cb) of the GSTA, to notify the Commissioner that the plaintiff companies had ceased to satisfy the requirements for payments basis and the Commissioner must therefore direct the companies to account for GST on an invoice basis.
  • The High Court held that s 19(3B) of the GSTA overrides or precludes the Commissioner from being required to give a direction under s 19A(2) and that the Commissioner must be satisfied at the time of notification that a registered person has ceased to satisfy the conditions in s 19A(1). Published 9 October 2026.
• GA 26/01 Legislation modification powers.
  • This general article explains the Commissioner's powers to modify requirements under Inland Revenue legislation in limited circumstances to help taxpayers meet their obligations. Published 13 October 2026.
• GA 26/02 COVID-19 response variations.
  • This general article explains the Commissioner's discretion to vary requirements under Inland Revenue legislation to assist taxpayers affected by COVID-19, covering the period from 17 March 2020 to 30 September 2023. Published 13 October 2026.
• CSUM 26/14 Relief from consequences of unless order granted.
  • This case summary considers a decision by the Taxation and Charities Review Authority to grant relief from the consequences of an unless order and reinstate a taxpayer's tax challenge. Although the non-compliance was serious, the Authority found it was not intentional or wilful and that maintaining the strikeout would be disproportionate and contrary to the overall interests of justice. Published 19 October 2026.
• Refreshed tax and social policy work programme Information release.
  • The Government has released its refreshed tax and social policy work programme, focusing on attracting investment, supporting small business, simplifying tax rules, strengthening tax integrity, and improving social policy. Published 19 October 2026.
• Reports to Ministers in 2026 Information release.
  • Inland Revenue has published an updated list of reports and briefing notes provided to the Minister of Revenue's office. Published 21 October 2026.

Open consultations

• PUB00266 Income Tax – Non-resident software suppliers’ payments derived from New Zealand
  • This interpretation guideline addresses payments made by New Zealand entities to non-residents in connection with software transactions. Its focus is on explaining the principles behind the classification of common types of software transactions. It also outlines the relevant income tax implications of those transactions under New Zealand law, including the impact of double tax agreements (DTAs). Consultation closes 31 October 2026.
• PUB00533 Income tax – Depreciation of low-value assets
  • This interpretation statement explains the income tax rules that allow a taxpayer to claim a depreciation loss deduction for the full capital cost of an item of depreciable property where the item’s cost does not exceed a specified threshold. It also explains how the rules work when a taxpayer purchases items of property together, and how depreciation recovery income can arise when they dispose of such items. Consultation closes 20 November 2026.
• PUB00525 Goods and Services Tax – Compulsory zero-rating of land rules
  • This interpretation statement explains the compulsory zero-rating of land rules and sets out what information a purchaser must provide to a vendor where a supply wholly or partly consists of land. It also explains what to do when the GST treatment is incorrect, including where a purchaser provides incorrect information. Consultation closes 27 November 2026.
• PUB00535 Income tax: Continuity of business activities – carrying forward losses arising in the income year of ownership continuity breach
  • This question we’ve been asked (QWBA) provides guidance on how the continuity of business activities rules in subpart IB of the Income Tax Act 2007 apply to losses arising in the income year in which a company breaches the continuity of ownership requirements. Uncertainty has arisen about whether that income year is an “earlier income year” under s IB 3(2), such that the losses can be carried forward. This QWBA confirms losses incurred in the income year of an ownership continuity breach can be carried forward. It is relevant to companies that have both an ownership continuity breach and a tax loss arising in the income year of the breach. Consultation closes 27 November 2026.
• PUB00490 Goods and Services Tax – Supplies of residences and other real property
  • This interpretation statement considers how sections 5(15) – (16C) of the Goods and Services Tax Act 1985 (Act) apply where a private residence is included as part of a wider supply of land. Section 5(15) deems the residence to be a separate supply from the rest of the land, which must be considered separately for GST purposes. Consultation closes 30 November 2026.
• PUB00506 Income Tax - Forestry
  • This interpretation statement explains how income tax applies to persons who undertake forestry activities (including those who derive income from sales of timber). It discusses the circumstances in which a person is (or is not) carrying on a forestry business, when a person has income from forestry activities, when deductions are available, and the forestry rights regime. Consultation closes 4 December 2026.
• ED0265 Mutual associations (including clubs and societies) 
  • This draft operational statement explains the income tax treatment of amounts societies, clubs and other not-for-profit associations receive from members, other than amounts subject to a specific tax exemption such as for charities or sports clubs. It describes how the mutual association provisions override the principle of mutuality meaning that supplies of trading stock and services to members may be taxable.  In addition, following legislative changes proposed in the Taxation (Annual Rates for 2026–27, FBT Simplification, Foreign Investment Funds, and Remedial Measures) Bill, membership subscriptions, fees and levies will generally be exempt income for not-for-profit organisations.  Organisations with net income of less than $10,000, will have no tax liability and may choose not to file tax returns. Consultation closes 11 December 2026.
• PUB00537 Income tax – Retention money
  • This question we’ve been asked (QWBA) explains when a person derives retention money as income and when they incur the expenditure of retention money for income tax purposes.  It discusses how in some cases retention money is incurred at the point when each progress payment from which retention money is withheld is payable, how the contractual terms governing retention money affect the timing of income recognition and deductions, including how the specific timing rule in s EA 3 and the financial arrangements rules apply in certain situations.  This guidance is important for taxpayers who use retention arrangements including those in the construction industry. Consultation closes 11 December 2026.

Recently closed consultations

• PUB00548 Can an Active Investor Plus visa holder become tax resident under the permanent place of abode test?
  • There have been some questions and uncertainty raised around the potential for Active Investor Plus visa holders to trigger New Zealand tax residence. We have been asked, in particular, whether an Active Investor Plus visa holder buying a residential property in New Zealand and staying there when in New Zealand during the investment period (and beyond) may result in the person having a permanent place of abode in New Zealand and so being tax resident here. This “question we’ve been asked” (QWBA) provides guidance on how the Commissioner sees the permanent place of abode test applying in various AIP visa scenarios. Consultation closed 13 October 2026.

For more information about upcoming consultations please see here for Tax Technical and here for Tax Policy.