Tony Morris: Inland Revenue spokesperson on the horticulture sector not paying enough tax

The Inland Revenue Department has unveiled the horticulture sector hasn't paid their fair share of taxes.

Over the last 10 months, the IRD has found $45 million dollars of undeclared tax - and almost 100 audits are in the works now, within the sector.

Inland Revenue spokesperson Tony Morris says the department is seeing people being paid under the table, undeclared cash sales and withholding tax going unrecorded or not being deducted correctly

"It's quite a complex industry - if there's payments going through with cash or what else, it's easy to get lost or for things to happen intentionally, where it's hard to track the money."

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Episode Transcript

Speaker 1 (00:00):
Now the IID has caught the horticulture industry underpaying taxes
to the tune of forty five million dollars. Tony Morris
is a spokesperson for IID with us now, Hey, Tony,
he very well, thank you. Is it more than you
were expecting.

Speaker 2 (00:15):
A little bit more for the tenmants so far? But
it is an industry where there's a risk of tax
not being paid well, either intentionally or not intentionally.

Speaker 1 (00:25):
Why is it a risk for this industry, Well, it's.

Speaker 2 (00:28):
An industry where there's plenty of cash. There's sort of
a transient workforce, so the growers need to employ lots
of different people, not for a whole year, at different times.
So what we see in the industry is the growers
who need people to pick for them, they tend to
employ a contracting firm who employ all the pickers. And

(00:50):
the contracting firms at times can actually also contract to
another contracting firm to contract to the pickures. So it's
quite a complex industry. And if there's payment going through
with cash or what else, it's easy to sort of
get lost or things that happen intentionally. We were it's
hard to attrack the money and not all the taxes
paid correctly.

Speaker 1 (01:10):
So how did you crack down on this? Is this
basically because you've got that extra funding for enforcement.

Speaker 2 (01:16):
It's an area that we've been looking at for a
few years, I mean, working cross government to try and
come up with some solutions, but certainly the excellent using
some extra money as well to increase what we're doing
over the next year or so, so a bit both really,
but certainly something that's something that we need to keep
working on.

Speaker 1 (01:33):
Yeah, how do you put the kibosh on this?

Speaker 2 (01:37):
It's one of those tricky problems. Certainly we're doing audits
where we need to and investigations, but the more we
can do to actually try and get the paid text
early is the best results. So what we've seen over
the last years is we're trying to actually work with
the growers who you know, who generally are doing the
right thing and want to make the industry safe, and
working with the industry to put more on them to

(02:00):
make sure that they can either withhold texts from the
contracting firms or make sure the contracting firms are viable
and compliant and similar with the contracting firms around when
they're paying the pickers they're deducting texts early, so we're
not leaving the text to come from the pickers at
the end of the day, but try to get the
text early on as the money's been passed across. So

(02:21):
a joint problem, but it's one of those ones that
we can educate people. Get the text early in the transactions.
That's the best way for us to go.

Speaker 1 (02:27):
Good stuff, Tony, best of luck with it. I really
appreciate your time, Tony Morris and Land Revenue Department. For
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