An embarrassing accounting error wrongly plunged the New Zealand budget balance $NZ394m (₤157m) into the red in January – the first time the country has recorded a deficit in 15 years.
But officials from the Inland Revenue Department, the country's tax authority, today revealed they had failed to take into account $NZ600m in provisional tax. The revised accounts put the government's operating balance back in black at about $NZ200m.
Finance Minister Michael Cullen said the IRD commissioner and the head of Treasury had apologised to him over what was a ‘simple mistake’.
John Whitehead, Treasury secretary, told reporters that officials began to doubt the accuracy of the number as they got early indications that February tax revenue was much stronger.
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