Global Daily Tax News, New Zealand Reports Bumper Yield From Enforcement Push, (Oct 22, 2025)

New Zealand's Inland Revenue Department significantly ramped up compliance activities last year, securing NZD11.81 for every dollar spent, according to the agency's newly released annual report.

This was up significantly on the return on investment of NZD9.50 in last year's report and markedly above the NZD10 target.

The agency said: "In Budget 2025, we were allocated an additional NZD35m in permanent annual funding for compliance and collection activities. We were also allocated NZD26.5m to continue activities that had been supported by time-limited funding due to end in June 2025. And we are seeing positive results from focusing on high-risk sectors including property non-compliance, trusts, organised crime, and the hidden economy, and making new uses of data and insights to better target our efforts. These results mean fairer outcomes for taxpayers and stronger confidence in the tax system. Our focus will continue to expand into high-risk sectors to protect honest businesses and ensures everyone pays their share."

The agency said this year's compliance activities included:

• 17,940 visits to business premises and worksites;

• 7,641 audits opened - 49 percent more than last year;

• 6,147 audits closed - up 42 percent;

• 28,530 voluntary disclosures by customers – one percent more than last year;

• 17 arrest warrants issued – up 42 percent;

• 80 warrants issued to access premises – up 63 percent;

• 50 prosecutions initiated – 32 percent more than last year; and

• 30 prosecutions completed – one less than year.

In addition, 88,367 Section 157 deduction notices were issued for overdue debt, up 19 percent on last year.

Compliance interventions yielded NZD1.4bn in revenues, against a target of NZD1.038bn, and debts of NZD4.3bn were paid (compared with NZD4.08bn targetted). According to the report, 94.5 percent of GST, employer deductions, and income tax was paid on time and in full, compared to 94.3 percent in 2023, and 92 percent of tax refunds were issued within five weeks, up from 86.6 percent.