Online influencers to be taxed more (3 May, 2021)

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Online influencers to be taxed more (3 May, 2021)

Postby aardvark_admin » Mon May 03, 2021 5:23 am

This column is archived at: https://aardvark.co.nz/daily/2021/0503.shtml

Everyone should pay their fair share of tax and to be honest, I pay more than I am really obliged to -- given that I don't claim back the GST on my input costs despite being elligible to do so and despite all my income being from overseas and thus free of GST.

Likewise, I don't sell *ANY* of the products I might get sent to review because then they would defintely be considered a form of income and thus taxable.

I hang onto stuff and now most of that stuff has zero commercial value anyway, simply because the technology becomes outdated so very quickly so if the IRD do decide that it represents an income, they're welcome to come and grab 25% of everything that's in the workshop. If that's not a satisfactory method of payment for them then why should it be considered a form of payment to me?

I figure that if they decided to make me classify this stuff (much of which I'm not even legally allowed to sell due to the pre-release nature of the product and the terms under which it has been supplied from the manufacturer) as income, I would simply stop doing what I'm doing and the country as a whole would likely be tens of thousands of dollars worse off -- due to the lost export earnings, lost income tax payments and the fact that I would start accepting my pension payout from the taxpayer. That would be a huge negative outcome from the perspective of the public purse.
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Re: Online influencers to be taxed more (3 May, 2021)

Postby GSVNoFixedAbode » Mon May 03, 2021 8:35 am

If those items are *not* considered a suitable form of payment for what might be owed to the IRD then why are you suggesting that *I* consider them a form of payment?

Nailed it!
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Re: Online influencers to be taxed more (3 May, 2021)

Postby hagfish » Mon May 03, 2021 9:14 am

I suppose you could send it all back again, but the cost of postage - not to mention the rigmarole of packaging, tracking, sending - would be a large, pointless compliance cost. At least it would clear your shed out a bit!
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Re: Online influencers to be taxed more (3 May, 2021)

Postby joeseph » Mon May 03, 2021 9:26 am

hagfish wrote:but the cost of postage - not to mention the rigmarole of packaging, tracking, sending - would be a large, pointless compliance cost.


Precisely the sort of thing that bureaucracy thrives on!
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Re: Online influencers to be taxed more (3 May, 2021)

Postby Perry » Mon May 03, 2021 9:34 am

If those items are *not* considered a suitable form of payment for what might be owed to the IRD then why are you suggesting that *I* consider them a form of payment?

The IRD may well epitomise the usual gummint mantra of day: do as we say, not as we do.

Thinking about that and the user-pays mantra, I hear that the IRD are running a survey about small businesses, by getting the owners to participate in some way. What recompense do you suppose the IRD is offering? If a taxpayer wants the IRD to do something, as a rough guide, considering the request will cost around $300 and the hourly rate is $161, with part hours charged as a full hour.

So IRD, lead by example and come across! :roll:
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Re: Online influencers to be taxed more (3 May, 2021)

Postby Malcolm » Mon May 03, 2021 11:38 am

This just sounds like IRD following up on the tightening of the Fringe Benefit Tax rules from a year or two ago. Sure for a lot of stuff you get, you run it to make the review, then never do much of note with it again it shouldn't be classified as that. However if a local cafe offered you free brunch every Sunday in exchange for a regular shout out in the channel that would. Or if GoPro or similar gave you a shiny new camera which you used for your production work. Maybe the answer for the old review models is to either dump them or donate to a suitable group to get them out of your possession and off your books so to speak.
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Re: Online influencers to be taxed more (3 May, 2021)

Postby phill » Mon May 03, 2021 12:19 pm

some interesting possible interpretations for this .. but mostly it just brings up more questions
first i have to wonder why makeup is exempt
any use after the review is done is personal gain .. so there is some / a lot of worth left in the product

also some questions
is the resale value to be calculated before or after the review
the value before the review is .. as new, unused, mint condition .. the value after can often be .. broken, no value

for sure if it was causing me a problem with IRD all reviews would end in a destruction test

there is plenty of IRD guidelines for depreciation .. is that the table they wish to be used ?

since there is now a requirement to pay tax on the item for review .. is that not then part of the expenses to review the item and hence itself tax deductible
i know how the IRD will look at that but the courts would likely decide otherwise .. and IRD would already know that
( ,,,,,,,, ....... A E I O U use em sparingly theres probably not enough )

i might live and eat in a sewer .. but hey look how many of these shiny things i have got
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Re: Online influencers to be taxed more (3 May, 2021)

Postby Perry » Mon May 03, 2021 9:51 pm

phill wrote:since there is now a requirement to pay tax on the item for review .. is that not then part of the expenses to review the item and hence itself tax deductible
i know how the IRD will look at that but the courts would likely decide otherwise .. and IRD would already know that

I have a vague notion that a sample vs an item bought for re-sale are treated differently. (But don't quote me.)
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