An Auckland house painter who dodged more than half a million dollars in taxes has been jailed.

Rangi Ngawai Kake was sentenced to 26 months in prison today in the Auckland District Court on six charges for not filing income tax, GST and PAYE returns for himself and his business, No Stress Decorators.

Kake was able to evade at least $544,895.39 in tax by not filing any tax returns.

Tony Morris, Inland Revenue spokesperson, said the amount was likely to be much higher due to Kake accepting cash payments, and his failure to provide investigators with information they asked for.

Advertisement

"Kake wouldn't co-operate with investigators and didn't provide the information they asked for. As a result the missing tax has been worked out based on documents collected from third parties," Morris said.

"The actual amount is likely to be higher than assessed because Kake accepted cash payments for jobs that were not put through his bank accounts and he didn't keep records of these jobs

"This was a deliberate abuse of the tax system which deprived other New Zealanders to the tune of just over half a million dollars in tax revenue. That money could have gone towards funding a range of important social services everyone benefits from."

According to the Inland Revenue Department, New Zealand is missing out on about $800 million in its annual tax take due to the country's self-employed under-reporting their income by about 20 per cent.

Research by Victoria University and the government's tax authority estimates New Zealand's self-employed, which account for 12 per cent of the workforce, on average under-report their income by a fifth.

Morris said Kake used the income from both his sole trader business and from No Stress Decorators for personal use.

"Bank records show substantial spending at TAB, Skycity, NZ Racing, Thoroughbred Tavern and from cash withdrawals," Morris said.

"We take this sort of offending extremely seriously. The public should be assured that Inland Revenue will do all in its power to prevent tax cheats from evading their taxes on this scale."

Advertisement