House painter jailed for half a million dollars of tax evasion

Business

The owner of 'No Stress Decorators' has been sentenced to 26 months in prison after failing to file any tax returns

27th Sep 18, 4:48pm by David Hargreaves

The owner of an Auckland housing painting business, No Stress Decorators, has gone to prison for paying no tax.

Rangi Ngawai Kake, was sentenced on Thursday to 26 months jail for evading more than half a million dollars in taxes.

Kake was sentenced on six charges for not filing income tax, GST and PAYE returns for himself and his business.

Inland Revenue spokesperson Tony Morris says Kake’s failure to file any tax returns meant he evaded $544,895.39 in tax.

“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.

“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."

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

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

“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.

“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,” Morris said.

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23 Comments

by powerdownkiwi | 27th Sep 18, 5:13pm 1538025215

Never pays to lay it on too thick.....

by Yvil | 27th Sep 18, 8:16pm 1538036199

Do you mean this article paints a poor picture of our tradies?

by saving4AUhouse | 27th Sep 18, 5:21pm 1538025673

"That money could have gone towards funding a range of important social services everyone benefits from."

By 'everyone' they of course mean landlords, pensioners, and people with no jobs who nevertheless decide to have children.

by pacifica | 28th Sep 18, 11:56pm 1538135813

To be fair everyone born in NZ and most of those not born here have benefited from roads and medical services. (a few of those not born here only separated out because they may live on a remote NZ island with no roads, absolutely perfect health, have no children, or only just arrived in the country by boat and have not used the immigration dept services but that is a small small minority of the wider populace you could probably count on one hand, hence most have benefited from public services). Otherwise you seem to be accurately describing Gloriavale & the Church and they have been getting tax free benefits & promoting poor birth control for generations.

by bilbo | 29th Sep 18, 9:41am 1538170902

https://2017.budget.govt.nz/budget/2017/my-tax-dollars/index.htm
33% of the budget is spent on super, landlord suppliments, working for families and bennies.
A good deal of education is just the government bribing young voters before they head off to Australia or compete their basket weaving degree.

Then you've got the healthcare which is a joke compared to that offered across the ditch. And how much of that is going towards diabetic pacific islanders and older Asian immigrants who haven't paid their fair share?

Every time I seek health care I have to pay through the nose. Private practices grab the ACC subsidies and hike their fees by the same amount. Dentists here have to be the most expensive in the the world and it's not like they offer world leading quality.

If I decide to work a bit harder and get a pay raise 33% of that is taxed right off the bat. Then there is 15% GST on the transaction depending on how competitive the prices are the consumer shares a portion of that burden with the retailer. My rates are going up at 4% each year for the next three years; All this goes towards council rot and not roads; Despite the big rates fixing potholes is left up to the residents who eventually fill them in out of frustration.

So there you have it. At least 40% of the budget is spent on election bribes, gibs-me-dats and lolly scrambles. I get none of it despite paying a lot of tax. You are simply burring your head in the sand if you think everyone benefits.

by Nzdan | 27th Sep 18, 6:07pm 1538028466

Still not stressed I bet.

by Pragmatist | 27th Sep 18, 6:17pm 1538029075

Whats he got to stress about, he's got accommodation and three squares sorted for the next 12 months at least.

by Roger Witherspoon | 27th Sep 18, 6:08pm 1538028528

Man Jailed for Gambling Addiction?

by Nzdan | 27th Sep 18, 6:14pm 1538028849

Probably had a few of those pesky meth plants growing in his backyard too.

by powerdownkiwi | 27th Sep 18, 6:39pm 1538030372

You bet!

by The_4th_estate | 27th Sep 18, 7:49pm 1538034583

Meanwhile some where a white guy has ripped off NZ for billions and became a Knight....

by pacifica | 27th Sep 18, 8:16pm 1538036200

Let me guess he is asked to repay a token amount at a rate not even close to paying it off in his lifetime. Assets paid for by the criminal activity owned by another entity say family member or trust are protected. The IRD need far more investigative staff to stop things getting this far. At over half a million it certainly should have been caught sooner.

by The_4th_estate | 28th Sep 18, 7:25am 1538076307

Who knows? I'm connected to the trades and I am well aware of the IRD's recent drive to crackdown on cash jobs and non compliance, this guy is being used as an example. There is far worse going on, I have personally witnessed Chinese property developers/criminal money launderers paying for entire houses to be built by handing boxes of cash directly to kiwi builders. Where theres concrete theres corruption!

by Pragmatist | 28th Sep 18, 7:47am 1538077644

And being a good citizen you reported this to the IRD of course.

by Nzdan | 28th Sep 18, 9:01am 1538082062

Why would he cut off the hand that feeds?

by The_4th_estate | 30th Sep 18, 11:17am 1538259455

No that grubby pair of hands wasn't feeding me but it was certainly feeding a lot of happy contractors who were only too happy to work that way.

by The_4th_estate | 30th Sep 18, 11:18am 1538259531

Not being a fan of being buried alive in concrete I chose to look the other way....

by cjmain | 28th Sep 18, 7:46am 1538077609

wonder how long he will get? if it's 5 years, that works out 100k for every year in jail, probably worth it for any tradie!

by Zack Brando | 28th Sep 18, 8:22am 1538079726

If a white collar worker had committed this tax evasion, I doubt very much they would have gone to prison.

I based that on the multitude of articles published each week where white collar workers, which have committed similar frauds received a slap on the wrist.

Thoughts?

by RickStrauss | 28th Sep 18, 9:44am 1538084648

I would be very interested to see how his sentence compares to others.

Citizen Yan got five months of hanging out in a luxury Metropolis apartment (and forfeiting some of his gains) for his tens of millions in money laundering.

by unaha-closp | 28th Sep 18, 10:01am 1538085717

Tessa Fiona Grant ripped off Diocesan School & Skycity Hamilton, got 7 years and 8 months.

by RickStrauss | 28th Sep 18, 10:07am 1538086021

Should know better than to steal from the rich, clearly. That can't be tolerated.

by unaha-closp | 28th Sep 18, 10:25am 1538087157

Sky City were initially very tolerable. Gave her a glowing reference to take to her next job at Dio, after she left Sky City unexpectedly.

It was only after she went on to defraud Dio and was caught by Dio that Sky City "realised" they had also been victims. It was all such a surprise to Sky City.