Woolerton R Doug: Taxation (Annual Rates Savings Investment and Miscellaneous Provisions) Bill — First Reading 
Woolerton R Doug: Taxation (Annual Rates Savings Investment and Miscellaneous Provisions) Bill — First Reading 
[Volume:631;Page:3444] 
R DOUG WOOLERTON (NZ First) 
: 
 As expected by the National Party New Zealand First will be supporting this bill going to the Finance and Expenditure Committee and as a member of that committee I look forward with intense interest to delving into some of the questions raised by the members who have spoken before me. I am sure with the collegial atmosphere that exists in that committee we will give it what I colloquially call “a going over” to see what is behind it. 
 New Zealand First favours investment we favour savings and more especially given that we are not a high-wage economy we favour investment made by those on relatively low wages. Again as has been pointed out by previous speakers we have a situation of what I still like to call managed funds which is the easiest investment vehicle that people who do not have a huge knowledge of investment and who would not regard themselves as experts tend to choose to invest their hard-won dollars in. It has been most unfair for people on relatively modest wages and on a relatively low tax scale to have their investments taxed at a flat rate of 33 percent. I think that all parties agree that that situation is iniquitous and it has to be changed. At long last this bill will change it and we in New Zealand First certainly applaud doing that. 
We then get into the business of having some interesting sorts of developments that have arisen historically amongst countries that trade in a like nature to New Zealand. They are countries that have tax regimes and economies similar to ours and are considered to be so-called friendly countries if I can use that term. Those countries are encompassed in the “grey list”. We have heard technical explanations of the “grey list” from people far more qualified than I am to speak about it but suffice it to say that some of those countries and some of the firms investing in those countries were paying very little tax or no tax at all. 
So it is interesting when we hear people talk about private enterprise free competition and so on and so forth to see that we have had a dual standard in existence in New Zealand. We have had investment for the masses if you like in managed funds that are taxed at 33 percent—way above those people’s personal income tax rate—and we have had other investments through companies that invested in those overseas “grey list” countries that have been taxed at a very much lower rate or—as we are now finding out—paying no tax at all. I for one will be interested as a member of the Finance and Expenditure Committee which will examine this bill to see not only what has been going on but also to see how that situation can be put right for the future and we will certainly do that. 
The exemption for Guinness Peat Group is an interesting one. I offer the explanation that was put to me which is that it was not a conspiracy and there was nothing hidden under the bed that I could work out. But we had an iconic company in New Zealand that was invested in by thousands of New Zealand mums and dads who followed a man called Ron Brierley and who have in many cases turned very modest investments into substantial ones. As that company moved offshore so did those people with their investments because they had no choice other than to pull out. That company subsequently morphed into something called “GPG” or Guinness Peat Group—is that the correct terminology? 
Chris Tremain 
: Twenty times the original investment. 
R DOUG WOOLERTON 
: So they have had the advantage of that investment. I agree with the two Ministers who have said that the fuss and bother that accompanied that move and the excellent public relations of that company have upset a lot of people who invested in a company in New Zealand. That company has now moved offshore and those people are being caught out and will be disadvantaged. We will discuss in the select committee whether members agree with that view and what we should do about it but I think that pragmatism has reigned with this bill from what I have seen of it. The Ministers have said that the Government will look at having a 5-year exemption. I have heard it called a holiday but there will be a 5-year time period in which the directors of that company may make a decision as to whether they want to bring the company back onshore and go along with the rest of the investment regime in this country or leave the company registered in foreign climes. 
I noticed in the latest  
Independent 
 that the chief executive officer of that company has said that that move is great but he is not happy with the situation. He wants to push harder further higher and all of the rest of it—and knowing his reputation with all due respect I would not expect him to do otherwise. That is exactly what I would expect him to do. But the company has a period of time in which to tidy up that matter and put the company into New Zealand ownership if the directors so wish. I say quite clearly it is my understanding that that matter will not be determined by virtue of either Mr Brierley or Mr Gibbs; it will be determined more by virtue of the mum and dad shareholders—if we can use that term—in the Guinness Peat Group. 
However that is the situation. We will look at all these issues and we will indeed ask questions around that matter and around many of the other aspects of the bill. I heard some members say that this bill is another tax grab or some other iniquitous imposition on people that the Government is making but the facts as we know them at this point are that this move will cost the State $110 million net—that is the figure the Government mentioned—so it can hardly be called a grab made by the Inland Revenue Department from investors at this point. We will see how that pans out. 
I want to talk for a moment about the investment regime for New Zealanders. As our name suggests New Zealand First believes that a country that does not promote itself either to other countries around the world or to its own citizens is a country that is not proud of itself not confident about its future and it should take a good look at itself. I am pleased to hear that the two Ministers who have spoken so far are talking in that vein. They are talking about sending a message to New Zealanders. We want them to invest in our own country. We want them to be proud of the country. We can make good returns for them in our country and most important we can use the money—the savings that they have—beneficially for the businesses in this country. There is no need for us to be making people in foreign countries wealthier. 
I look forward to debating the Taxation (Annual Rates Savings Investment and Miscellaneous Provisions) Bill in the select committee. I am sure that committee will come back in due course with a very sensible decision made across all parties.