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Inland Revenue to use Online Collection

The Inland Revenue plans to roll out a new tax payment system, similar to that of online banking, so customers can make payments easier while keeping track of their account.

Revenue Minister Peter Dunne made the announcement yesterday in response to a new report released by Auditor General Kevin Brady which stated that the rate tax debt was increasing was quicker than the department’s capacity to collect it.

The report also stated that at the end of June 2008 there were 220,000 cases of tax debt, with an estimated total of $4 billion.

Based on these figures and the contents of the report, it was claimed that the total amount of tax debt could more than double in 5 years unless a different approach was taken to manage the issue.

“A lot of the problem that’s arising with debt is the penalty process kicks in, debt starts to mount and people basically freak out at the idea of having to make these payments,” Mr Dunne said.

“We want to try to nip that in the bud by making the system much more people-responsive so we don’t get the sort of level of out-of-control debt we have at the moment.”

Mr Dunne also revealed that in recent years a number of new practices and measures had been put into place as a means of reducing the amount of debt, and “these had worked reasonably well.”

“I think the bigger picture now is that the processes we’ve operated really haven’t been given the sort of radical shake-up we’re imagining since the late 1950s,” he said on Radio New Zealand.