No wonder everyone seems to hate the IRD.

A group of people managed to invest in a scam run by a man called Donald Rea, where (as per usual) large rates of return were promised. However, Rea simply paid them back out of their original capital, making it more like an interest free loan given to him, than an investment. The Serious Fraud Office provided evidence at Rea's trial (before he died during it) showing that this was the case.

However, the IRD is now chasing those who were caught by the scam, demanding tax be paid on the 'interest' that they received from the scam. And of course they want stiff penalties as well.

This is just silly. These people never received any interest - they probably didn't even get all their capital back. There is no way they should be paying tax on it. Now they will have to fund legal appeals to stop them.

So much for the IRD's undertaking to a parliamentary select committee to be more flexible towards taxpayers.

Posted by Dave Bryant at 12:41 PM | Comments (0) | TrackBacks (0)