National exposes 'loophole' in interest-free student loans
National has exposed a loophole it says could see people exploiting Labour's new interest-free student loans.
Thursday, November 24th 2005, 6:09PM
by The Landlord
In Parliament, National's leader Don Brash highlighted a case in which a man used a clause in the 1992 student loan legislation which allows people to reclaim any voluntary payments within six months of making them.Dr Brash says the man has withdrawn $15,000 of voluntary payments and placed it in the bank to earn interest.
Student loans are set to become interest-free next April under legislation currently before the House.
Finance Minister Michael Cullen says he is talking to Inland Revenue about closing the loophole.
According to Inland Revenue figures, $164 million was paid in voluntary loan payments in 2004.
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