New Zealand Inland Revenue Receives a Funding Boost

New Zealand's Budget for 2025 was delivered on 22 May 2025. The primary focus was on stimulating economic growth and addressing the cost of living. Importantly, from an Inland Revenue perspective, we received a major increase in funding to boost collection activities and invest more in tax compliance.

The Commissioner of Inland Revenue, Peter Mersi, has welcomed the increased funding which means the great majority of New Zealand taxpayers who meet their obligations can continue to be confident that the tax administration will find those who aren’t compliant:

“Budget 2025 provides new additional permanent funding of $35 million per year for Inland Revenue to invest more in tax compliance and collection activities. Along with the $29 million per year that was allocated in the 2024 Budget, this is a significant funding boost and is recognition of what we do and the excellent results we’ve had so far this year. In addition, the Government has agreed to continue $26.5 million of funding that was set to end this year and importantly made it on-going. This means we can continue with a range of compliance and debt work.”

There is an expected return on this increased investment by the Government, being an additional $4 for every dollar invested in year 1, and $8 from year 2. This is in addition to increasing the return from last year’s compliance funding boost by $8 from 1 July 2025.

Inland Revenue will use the additional funding to focus on new activities including:

• further increasing audits and debt collection in areas of high risk and/or value,

• investigations into specific sectors such as property, organised crime, the hidden economy and trusts,

• improved use of data and intelligence to more quickly identify and target discrepancies and pursue debt,

• shifting from a manual to an automated process to collect data from third parties (such as banks), and 

• reviewing more targeted compliance activity measures.

Inland Revenue will take on additional staff to deliver this work, as well as using our systems and technology in more effective ways.