Latest / Best of Business / Simon Watts: Revenue Minister admits Donald Trump was a factor in scrapping Digital Services Tax Bill

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Simon Watts: Revenue Minister admits Donald Trump was a factor in scrapping Digital Services Tax Bill · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks at B
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  Speaker 1: News Talks at B.
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  Speaker 2: Hey, good afternoon. The government has ditched the Digital Services
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  Speaker 2: Tax bill. This means they're not going to try to
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  Speaker 2: make Google and Facebook's own a Meta and various other
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  Speaker 2: tech companies pay more tax than New Zealand. Simon Watts
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  Speaker 2: is the Revenue Minister.
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  Speaker 3: High Simon, Hey, very good afternoon.
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  Speaker 2: Hither so did the Trump administration put you off?
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  Speaker 3: Look AT's a fecta that we took into account.
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  Speaker 4: Obviously, the recent developments that have been going on, including
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  Speaker 4: those in the US, have naturally formed part of our assessment.
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  Speaker 4: But at the end of the day, I took a
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  Speaker 4: look at this tax. We've been looking at it a
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  Speaker 4: bit and it's got some real drawbacks and we've made
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  Speaker 4: the decision to pull it from their gender.
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  Speaker 2: Did Trump administration talk to you guys one on one
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  Speaker 2: or are you just reading the tea leaves from comments
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  Speaker 2: they've made.
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  Speaker 3: Now they're no discussion one on one on this specific matter.
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  Speaker 4: But you know, the reality is as you would expect,
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  Speaker 4: you know, where we're taking a look naturally at all
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  Speaker 4: of the factors going on. I think the thing about
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  Speaker 4: this tax is it's got a number of drawbacks. It
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  Speaker 4: doesn't actually tax profit, it actually tax income or losses,
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  Speaker 4: so a company could actually be in losses and be
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  Speaker 4: still subject to the tax. UK put in place this
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  Speaker 4: in twenty twenty and what they found is actually the
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  Speaker 4: tax has got passed on to consumers. And you know
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  Speaker 4: that's a big issue for us in the cost of
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  Speaker 4: living crisis. And you know, I had a number of
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  Speaker 4: concerns on the actual underlying drawbacks of the tax, but
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  Speaker 4: it's a big number on our P and L and
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  Speaker 4: hence we wanted to make sure we kicked the tires
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  Speaker 4: on that before we pulled it. The other big thing
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  Speaker 4: is actually in April the OECD grouping of countries, which
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  Speaker 4: about one hundred and forty countries have made an agreement
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  Speaker 4: to support a multilateral solution.
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  Speaker 3: I've watching New Zealand's part of and our.
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  Speaker 4: Viewer is that's a better way to progress on that,
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  Speaker 4: and so that work's going to probably pick up in
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  Speaker 4: the next months to year to come and hopefully brings
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  Speaker 4: a much more enduring solution to this problem.
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  Speaker 2: I think it's actually going to happen, though, I mean
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  Speaker 2: because multilateral things hardly ever actually bear fruit.
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  Speaker 4: Well, it is hard to say, right, I mean, you're right,
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  Speaker 4: the chipneys are challenging and ongoing conversations. But as I said,
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  Speaker 4: you know, the one hundred and forty countries to make
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  Speaker 4: a call in April of this year to say, hey.
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  Speaker 3: We're going to work on it.
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  Speaker 4: The technical works actually all being done. It's now ready
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  Speaker 4: for the countries to get some agreement on it. That's
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  Speaker 4: a lot better than where it was in the past.
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  Speaker 2: I mean, do we just need to accept that. Look,
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  Speaker 2: we'd all love to tax Google and Facebook, but probably
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  Speaker 2: just never will be able to.
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  Speaker 4: Well, look, the reality is, you know it might sound good,
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  Speaker 4: but those that tax is going to get passed.
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  Speaker 3: On to consumers. So whether you're using Amazon or you're
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  Speaker 3: using door dashed auto your food, you know those.
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  Speaker 4: Tax are going to flow through to consumers. And this
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  Speaker 4: goverment's really focused on making sure that we're not putting
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  Speaker 4: more costs on New Zealanders. And this is one example
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  Speaker 4: of us taking that pressure off in the future.
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  Speaker 2: Out of ten, what are the chances of power cuts
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  Speaker 2: next winter?
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  Speaker 3: God, next winter?
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  Speaker 4: Although that's a bit you know, that's I think they're
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  Speaker 4: pretty low in the context of where we are, but
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  Speaker 4: I am worried about energy security. Obviously, my main focus
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  Speaker 4: is this winter, and obviously this.
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  Speaker 2: Winter we seem to be okay. It's next winter that
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  Speaker 2: we's a problem.
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  Speaker 4: Yeah, but we've done a lot of actions to make
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  Speaker 4: sure that this winter wasn't you know, coming into this
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  Speaker 4: job back in January, this winter was at risk and
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  Speaker 4: we've got a number of actions around you know, Stockpilot,
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  Speaker 4: Huntley and all of that.
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  Speaker 3: But yeah, next year it remains at risk.
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  Speaker 4: But I'm working pretty hard with all of the players
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  Speaker 4: in the market to make sure we're mitigating that risk
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  Speaker 4: as much as I can. And it's a major it
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  Speaker 4: is my priority in the energy portfolio.
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  Speaker 2: Yeah, good stuff, Simon, Thanks very much, appreciate it. Simon,
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  Speaker 2: Wat's Revenue Minister and obviously Energy Minister will come back
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  Speaker 2: to that in the team.
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