Cunliffe David: Taxation (Bright-line Test for Residential Land) Bill — In CommitteeText is incorporated into the Bound VolumeCunliffe David: Taxation (Bright-line Test for Residential Land) Bill — In Committee[Sitting date: 10 November 2015. Volume:710;Page:7855. Text is incorporated into the Bound Volume.]Hon DAVID CUNLIFFE (Labour—New Lynn): I seek a call on the title and commencement clauses of the Taxation (Bright-line Test for Residential Land) Bill and I would like to put them the other way round and actually go to the commencement date which is 1 October 2015. We are not only passing bad law by I think the House’s general admission that this bill is not well conceived; it is not effective as it will raise only $5 million. And according to the tax profession it is likely to have the perverse effect not of catching genuine property speculators who can easily avoid the bill’s imposition by holding property for 2 years and 1 day or redefining it but of actually hitting families who are in the position where they have to sell for either financial or relationship reasons. That is a perverse outcome.So why are we doing this retrospectively? Why are we passing in November a bill that has its commencement date in October? I think the answer to that is it is a Budget special. It goes I think to Mr Cosgrove’s point that the polling must have come in just prior to the Budget and the realisation dawned on Ministers as they sat feverishly around the Cabinet table that they were in trouble because they needed to be seen to be doing something about the Auckland property market: what could they do that was simple quick and would not actually penalise the constituencies that they are there to represent which are the owners and holders of big capital? So they came up with this little beauty.I remember thinking on Budget day: “Gosh a brightline test. That’ll clarify the former subjective intent test.” I thought: “Well that might be a good thing to be fair to them.” And thank you to the profession because when the accountants came in and the lawyers came in and testified to the Finance and Expenditure Committee they made absolutely clear that this bill was rubbish—absolute rubbish. Officials who would be providing free and frank advice—at least if Iain Rennie ever stood up for them—Chris Bishop: Oh!Hon DAVID CUNLIFFE: Yes Mr Bishop if the State Services Commissioner ever stood up for Public Service prerogatives which in a former life that member specialised in running down because they shall do as the Minister says not as the facts say. But nonetheless officials have said on this bill that it will raise only $5 million—raise only $5 million—so it must have ticked all the boxes for urgent Budget legislation. And then it had a truncated select committee process which identified but could not fix the fundamental problems with the bill. We have been through most of them in Part 1 of this bill.Now we are committing the double sin of passing hasty legislation retrospectively. Why? Because it is poll-driven fruitcake stuff. That is what it is. It is the veil of progress when there is no progress. It is the impression of genuine tax legislation when it is not. That is why we are doing it retrospectively with a truncated select committee process. It was a rabbit pulled out of a hat to make the Budget look better than it was. That is what the public can all see. It is what the profession can see. I think it actually proves the point to members opposite and to the Government that in the end it is good law—good law based on good advice—that will make a difference.So what shall we call this bill? What should its title be? The “Band-aid Tax Bill”? The “Crosby/Textor Tax Bill”? With due respect to our revenue spokesperson the “Clayton’s Tax Bill”? The “Tax Bill You Have When You’re Not Having A Tax Bill”? Is it the brightline test you have when you actually do not want to catch anybody out that might otherwise be your friend a donor a supporter? Goodness knows the property speculators and the banking community will not be waiting up at night to see whether this bill has been passed. They will be sleeping soundly in their feather-fluffed beds.This bill does almost nothing—almost nothing. Maybe that is the proper title for it: the “Almost Nothing Tax Bill”. Or maybe it is the “Waste of Paper and Time Tax Bill” because that seems to have been its main impact on the House. You would think that after 7 years in office and all the resources of Treasury the Inland Revenue Department—with its $1.5 billion computer fiasco—that the current Government could have thought of something just a bit more substantive when it was seeking to address apparently one of the most critical economic challenges of our age which is the twin disasters of Kiwi families being locked out of the dream of homeownership and the misallocation of capital towards speculation not investment in productive business.