Adams Paul: General Debate 
Adams Paul: General Debate 
[Volume:623;Page:18678] 
PAUL ADAMS (United Future) 
: 
 I bring to the attention of the House an area of great concern to Aucklanders and that is the forthcoming rates increases that the various councils are beginning to speak about. It is often said that it is the straw that indeed breaks the camel’s back. United Future has campaigned hard for a long time in this parliamentary term for a zero rating of rates for GST purposes. Now when we begin to see again that the rates increases in Auckland City are running at double and triple the current rate of inflation I believe that this issue needs to be brought to the forefront and to our attention. 
Earlier this year our member Gordon Copeland brought in a member’s bill that would have achieved the zero rating of GST on rates. Many in the House chose not to support that measure yet the cost would have been only $160 million. With the Budget in surplus and debt tracking down $160 million is almost petty cash territory in relation to total Government expenditure. 
Look at the interesting scenario we have in Parliament right now. The current Minister of Finance was an opponent of GST being applied to rates when he was a Labour Party senior whip. The Leader of the Opposition whom we have heard much about in this debate Dr Don Brash was the co-chair of the committee that recommended that GST be applied to rates. He is the same leader—Don Brash—of the National Party whom I heard badgering in this House yesterday against United Future because we wanted and supported an increase in fuel tax so that we can get the gridlock and the roads unlocked in the fine city of Auckland. That same leader was on the committee that put a tax upon a tax. Every fair-minded New Zealander knows that GST on rates is just a tax on a tax. One of the things that concerns me as a mere tradesperson who went into business—[ 
Interruption 
] I do understand GST far better than Chris Carter for example who offered to have me briefed by the Inland Revenue Department on zero rating of rates for GST purposes only to be told that our understanding was correct and his understanding was not correct. 
Removal of GST will not alter the revenue intake by local authorities. Both Australia and Canada do not have GST on their rates because they consider it a tax on a tax. Yet when we try to deal with that issue for the public of New Zealand we get a press release from the chairman of the Local Government Forum Simon Carlaw stating that United Future’s campaign to get rid of GST on rates would raise costs for everyone. Clearly and unfortunately those people in local government do not understand the issue that we are dealing with. Let us be clear. The removal of GST on rates will not alter the revenue of councils or the net revenue of businesses. It will however mean that the 12.5 percent GST impost will no longer be added to the bills of 1.7 million New Zealand ratepayers. The ratepayers need a break. Councils will increase rates from time to time but let us give them a fair go. They know that 9 percent of a rates bill goes to the Government coffers as a tax on a tax. United Future says that it is time to remove GST from rates. That would provide a 12.5 percent leeway so that over the next few years the hard-working New Zealand ratepayers—the homeowners of this country—will at least get a break and the camel’s back will not have to be broken. 
Removal of GST will positively affect the cash-flow position of ratepayers. They will have more dollars in their hand. I have never seen a Government that is such an expert at collecting tax as this Labour Government has been. The surplus is incredible. If the Government genuinely wants people to save if it genuinely wants people to become homeowners let us not put another negative on that by thumping the poor old ratepayer once again. Let us give them a break. Let us remove the GST from rates.