party will support the bill but we will oppose
will oppose this Supplementary Order Paper and the way it is
being treated. Thank you, Mr Speaker. I
call Michael Wood. I am
delighted to rise in support of the bill and the
rise in support of the bill and the
Supplementary Order Paper. I want to
thank the previous speaker, the
Hon Steven Joyce, for his detailed
exploration of the 197 pages of
detail that emerged from the select
exploration of the 197 pages of committee on this important tax bill
that covered a wide, wide range of
areas. Actually, of course,
he spoke about
areas. Actually, of course, he spoke
Order Paper. I understand it has been a long, long and
difficult day for the National Party and I
want to fill in a few of the gaps, a
few of the things that he
missed in his comments about
comments about this piece of comments about this piece of
legislation that has been
in the works for about 9 months and on
which the select committee across
the House has
engaged very constructively. Before I do that,
I think I would be remiss if I didn't
provide a little bit of additional
commentary on the Supplementary
Order Paper that we do have before
us here today, sir. What I want to
Order
us here today, sir. What I want to start with is an example that was
provided by CoreLogic, the
public policy organisation who has done
a lot of work about the housing
crisis and probably understands
the state of the New Zealand housing market
more than most other organisations
what are out there. Here is an
example they raised in recent public
debate
example they raised in recent public
As it happen, it relates to my own beautiful electorate
beautiful electorate of Mt Roskill beautiful
beautiful electorate of Mt Roskill where a property on Rauranga
Avenue sold
where a property on Rauranga Avenue
2016. It was then settled in November. In June of the next year,
it was flipped
November. In June of the next year,
nine months, a huge, big capital gain
nine months, a huge, big capital
changes that this Government is going to implement in
the housing market, inclusive of
this capital gains tax, is about moving towards
a fairer and more reasonable regime
that says to New Zealanders,
you go out there and you work hard in your job, you get
paid your salary, you get taxed on it.
You have a whole range of
other investments, you get taxed on
it. But in cases like this one,
people who are making huge capital gains
are not necessarily
being taxed on them and that absolutely is one
of the factors that the contributing
to them
the factors that the contributing to a property market that is absolutely
out of control. Every single
member of this House, if they care to ask
of this House, if they care to ask
around, will find people in the
areas they represent who are simply
being drive yep out of the property
market. I have to reflect on
Mr Joyce's comments and his passionate
market. I have to reflect on Mr plea for more time to look
at this issue. After nine years of
utter inaction in the Housing crisis, nine
inaction in the Housing crisis, nine
years in which
hundreds of thousands Joyce's
years in which hundreds of thousands of people have been driven away
from the dream of home ownership, nine
years in which home ownership
rates have slipped to their lowest level
in the early 1950s when Sidney
Holland was the PM in this House,
this
Holland was the PM in this House,
will not sit on our hands anymore but we will do something and we
will implement the commitments we made at
the time of the election
when people say we want a Government that
will take action on the
say we want a Government that will
We have Mr Joyce deferring to the Government departments. We listen
to our Government departments
and consider what they have
to say but leadership in Government means
knowing what your policy is, knowing
what is problems are and means
marching towards some solutions with
some determination. It doesn't
mean you always simply say yes, sir,
yes, madam, we will
listen to what The Treasury or IRD say. We will
listen to what naysay but this Government
will take action on the issues. One
of the reasons we have properties
lie Rauranga Avenue with a
capital gain like that
over nine months is because for nine years that previous
Government did absolutely nothing
about that issue. I
am absolutely in support of
support of the Supplementary Order Paper. I have to mention 2
emotive point that Mr Joyce
came back to that somehow that is going to impact
your honest, hard working mum and
dad investor looking for
a nest egg. Those kinds of investors
aren't flipping properties
flipping properties within five flipping properties within five
years. Those kinds of investors are
setting up a
years. Those kinds of investors are
for their retirement. It is simply scaremongering and inaccurate
to say that
scaremongering and inaccurate to say
which is aimed at cracking down on those speculators, is going to have
which is aimed at cracking down on any impact on those
investors. That is simply not the nature of it. Let's respond
to the high dudgeon we hear on
the other side of the House. What that
previous Government did after the
last election when they were forced
last election when they were forced
into doing something to
look like they had any solution
to the housing crisis, is pretty quickly they
crisis, is pretty quickly they
be realistic about this, there is no great point of principle here. We
are talking about making it
a longer
effective. That is what we are effective. That is what we are
talking about and that is what this
You keep backing the officials and pretending, Mr Hudson, that there is
pretending, Mr Hudson, that there is
nothing wrong. What I would say to
the new National Party opposition
with their new leadership that if
they keep putting
their heads in the sand and saying there
is absolutely nothing wrong with the
housing market and if they keep
pretending that everything is fine and dandy
with the housing market
then please go ahead because New Zealanders
know that there is something wrong.
This Government knows there
is something wrong and we are quite
happy to be the
wrong and we are quite happy to be Government
wrong and we are quite happy to be the ones who do something about
the matter. Having dealt with
that little issue, I want
to return to some of the other aspects that come
through in the bar 2 version
of the bill that has
through in the bar 2 version of the some
through in the bar 2 version of the from select committee.
Notwithstanding my
Notwithstanding my previous comments I want to pay tribute to members
of the House from
all different pears who are part of the Finance
and Expenditure select committee
who work through what was a pretty
complex piece of legislation and I
think have come to a really good
think have come to a really good
outcome. I want to acknowledge the
former minister, Judith
Collins, who is in the House, who put
the bill former
is in the House, who put the bill before
before the select committee prior to before the select committee prior to
the last election and the
current minister Stuart Nash who has shown a
willingness to engage
around the issues and come back with
an improved piece of legislation. The
bill that is before us does a few
key things. One is that it confirms
the tax rates for the current
tax year. That is, of course, rather
important. We want to make sure that
we appropriate from the good we appropriate from the good
residents of New Zealand is
done so lawfully. It also has a number of
measures within it that
modernise and improve the tax
system and these, to a large extent, relate
the business transformation project. Quite a lot of changes
relating to payday, the frequency
of reporting, moving to a payday reporting
system and investment income reporting.
The benefit of these changes
is that they allow inland revenue and the
broader apparatus of Government to
have better and
more timely information and in doing so
we are more likely to ensure that we are
actually taxing individuals
at the correct amount. So while
there are potentially some small
burdens that fall on those who have to
file in terms of more regular filing and
I will address some
of the changes made at select committee here, the
benefits for
benefits for taxpayers across the board are actually quite significant
in my view here. The
third key purpose of the bill at the outset is
improving the settings to
ensure we retain that broad base
improving the settings to ensure we
system that has pretty wide support system that has pretty wide support
in the New Zealand tax community and
in this parliament and you do that
by making sure that you're
taxing fairly across all areas of economic
activity and the key one that
this bill looked to address was the area
of employment share schemes where
of employment share schemes where
after quite a lot of
dialogue over a number of years inland
revenue, the past Government
past Government and this Government past Government and this
Government has arrived at the conclusion
that we do need some improvements to
ensure that earnings
that are received as a result
of employee share schemes are
effectively taxed in more or less the same ways as
earnings people receive in
other ways. There was a concern
our previous regime didn't do that.
previous regime didn't do that.
I want to touch on one of two of the key
key changes that the select committee made. One of the ones I
want to focus on, which
was a good change that we got agreement on
across the committee, is about the
what's called the payroll subsidy. This is a small amount which is
paid to ensure that largely small
bit of support, to go through a payroll intermediary to
make sure that their tax has
been filed electronically and in the right way.
This is quite a useful innovation
This is quite a useful innovation
that was introduced a number
of years ago and it gives those
quite small employers mainly just a
little bit of extra support to make sure
that they're paying their tax in the
that they're paying their tax in the
right way. The original proposal of
that they're paying their tax in the that
that they're paying their tax in the the bill was to do away with that
payroll subsidy and in the view
of the committee, sir, that was a
bit hardline, a bit arbitrary, a bit
ideological. In our view it
is entirely appropriate,
entirely appropriate, particularly when this bill puts a number of
new obligations in
obligations in terms of the frequency of filing on employers
to provide just a little bit of support
to those small employers. So
the payroll subsidy has
been reformed under the bill that has emerged
from select committee. We are
keeping it in place for two more years
to allow people to transition into the new
requirements and it will now
be more targeted. It will just apply
to those employers who file with under
employers as a result of the select committee's work will still have
committee's work will still have
access to that payroll subsidy.
That was a very good change indeed.
Overall this is
an important bill. It modernises our tax system. I
commend to it the House
along with the Supplementary Order
commend to it the House along with the
commend to it the House along with will bring back a little bit of
fairness to our property market. I
call the Hon Judith Collins.
It has been a delight to listen
to if discussion this afternoon. As
the former minister who
brought this bill first to the House, it is
good to see it continued on,
except with one exception. I want to talk
about the
one exception. I want to talk about
a start, as someone who has been involved in tax and the
tax system for a long