The Government invested funding in new initiatives for IR to implement in Budget 2024. We have progressed both policy and operational aspects of these initiatives. This has meant a lot of change delivery for IR and some stakeholders.
Implementation of changes are managed at specific times of the year to ensure coordinated, efficient changes to systems and business processes and minimise customer impacts. All our initiatives met implementation timeframes or are on track.
Introduction of FamilyBoost
Through Budget 2024, the Government introduced the new FamilyBoost scheme. It reimburses up to 25% of a household’s early childhood education fees to a maximum of $150 per fortnight. As you can read below, the scheme was delivered on time and made payments to 60,300 households in its first year.
Compliance investment
Compliance interventions, including those that enhance the fairness and integrity of the tax system, are an opportunity to increase revenue.
IR refocused resources this year to deliver more compliance activities, with an additional $29 million Budget 2024 investment.
The additional funding was provided with the expectation of generating a return of 8:1 after the first year, primarily through a combination of increased tax revenue and decreased debt impairment and debt write-offs expenditure.
Our page on major spending decisions outlines what we achieved.
Budget 2024 Major Spending Decisions
Personal Income Tax changes
In July 2024, IR went live with the Personal Income Tax changes initiative, including changes to the Independent Earner Tax Credit, In-work Tax Credit and Minimum Family Tax Credit entitlements. These changes were well-received by customers and employers.
Interest deductibility on residential property
A significant Budget 2024 initiative was to reverse limitations on interest deductibility on residential properties. The limitations had been introduced by the previous Government in 2021. From 1 April 2025, customers were able to claim 100% of the interest they incurred (with exclusions applying, such as properties that are a main home).
Online gambling duty
A 12% duty on online gambling came into effect on 1 July 2024. The duty applies to online casino gambling provided by offshore operators to New Zealand residents.
We assessed $61.9 million in payable tax in this first year.
Budget 2024
Major spending decisions
- FamilyBoost: LAUNCHED
- Investment in compliance activities: 3/4 TARGETS MET
Major forecast savings and revenue decisions
- Online casino gambling tax changes: IMPLEMENTED
Significant initiatives
- Crypto-assets Reporting Framework: LEGISLATED
- Personal Income Tax and Independent Earner Tax Credit threshold change: IMPLEMENTED
- In-work Tax Credit rate increase: IMPLEMENTED
- Restoring interest deductibility for residential rental property: IMPLEMENTED
Baseline savings
- Reduction in operating expenditure: ACHIEVED
- Reduction in systems maintenance and change capacity: ACHIEVED