O'Rourke Denis: Taxation (Land Information and Offshore Persons Information) Bill — First ReadingText is incorporated into the Bound VolumeO'Rourke Denis: Taxation (Land Information and Offshore Persons Information) Bill — First Reading[Sitting date: 25 June 2015. Volume:706;Page:4809. Text is incorporated into the Bound Volume.]DENIS O’ROURKE (NZ First): As we know this bill focuses on getting better information from all people dealing in land especially overseas buyers and that is a good thing. New Zealand First welcomes it. We will support the bill as far as the select committee at least. The bill inserts two requirements into the Acts it amends: one for a New Zealand IRD number and another for an overseas tax number for those who are currently tax resident in other jurisdictions. The IRD number does not apply to a New Zealand individual buying or selling their main home unless they are selling their third main home within a 2-year period. It should include that information from the first home because it is just information. It does not actually affect anyone purchasing or selling homes in itself. It needs to be complete information and so that needs to be changed in the bill and I hope it is during the select committee process.This process is easy. It is not an expensive process. As we know the information will be collected from property vendors and purchasers by conveyancers who will then provide it to Land Information New Zealand who then pass it on to the Inland Revenue Department and to the Government generally. That is a far cry from what Nick Smith used to say about all this being far too expensive and far too difficult to do. Now we see the Government doing it and that is good. The turn-round is fine; as long the Government keeps adopting New Zealand First policy we will be happy. But this measure will provide a mechanism only for collecting the information during the conveyancing process. It will not form part of the land transfer register and it will not be publicly available. It should be publicly available; there are not any reasons to prevent that that I am aware of. We all should have access to that information to the raw data to produce and use the statistics to inform the public about what is going on.New section 156F added to the Land Transfer Act by clause 4 permits the Chief Executive of Land Information New Zealand to release or give tax information to any person who requests it provided that the information is given in aggregate form only and in a manner that prevents any person estate in land or transaction from being identified. They should be able to do that as of right. It should not require discretion on behalf of the Chief Executive of Land Information New Zealand. There is no need for the protection provided as landownership is a public information right and privacy is simply not relevant.This bill and the information it will cause to become available are what New Zealand First has been asking for for several years. It creates in fact a register of overseas ownership which is what we have been asking for and it would be that in everything but name—everything but name—if it were publicly available which it needs to be. It is necessary for the public to know the scale of the impact of overseas buyers of homes and farms whether as part of immigration or by overseas speculators. For housing we know that at least 9 percent of the demand is from net migration and that is from an independent source in the book which many of you will have read Generation Rentby Shamubeel Eaqub. It is a good book that I hope the people opposite will take notice of. It is significant.He says: “A 100000 population increase in 1961 would have needed just 15900 homes while today it is 25600 and that is of course because of differences in residential densities.” In his conclusion on the effect of buyers from overseas he says: “Some of the strong growth in housing demand in places like Auckland is coming from changes in net migration.” and he says: “Given that between 2012 and 2014 the demand for housing rose from around 9000 units to some 25000 to 30000 net migration must have increased the housing demand significantly.” So that gives us an indication of the scale of the issue which this Government is doing nothing about. New Zealand First has always said it is a significant issue and National has denied it and continues to deny it. But it is in fact actually undeniable now and the vast majority of the people out there in the public actually know that.This bill is a minor step in the right direction to uncover the facts about overseas buyers and homeownership. New Zealand First will support it. It will not be enough. The Government needs to acknowledge the problem of overseas ownership and net migration and not just tax issues. Then it needs to curb immigration and prohibit overseas ownership of homes and farms altogether. As well it needs to make sure that people pay their fair share of tax whether they be in New Zealand or overseas. The tax administration amendments are wider than just tax compliance in land dealings. They are intended to promote the enforcement of tax obligations of offshore people generally. In essence a person that is not a citizen or permanent resident will be an offshore person and subject to the bank account requirements. It introduces a 2-year brightline but we think that 2 years is far too short. We know what will happen. Very little will happen in fact. People will just wait out the 2-year period. Easy to do—such a short period so it will really in the end have little or no effect. Nevertheless New Zealand First supports it as a small step in the right direction but it is a minor measure and much more is needed.In fact taking the larger view if the Income Tax Act were properly enforced and were broad enough a capital gains tax would never be needed in this country. It is high time that the income tax rules were generally reviewed to catch everyone who uses homeownership for a business purpose. They do not do that; that is a big defect in the system in New Zealand. This Government has been far too slow about all this and it leaves a massive gap that actually encourages speculation and nobody should be surprised as a result by what is happening in Auckland with house prices.Although these measures in this bill are good as far as they go the point is they do not go nearly far enough and I have indicated already where the Government needs to go next. New Zealand First now waits for those next steps to be taken. Information alone is valuable but not enough. Overseas ownership needs to be prohibited. Current overseas ownership needs to be properly and fully revealed and not protected in the ways that I have mentioned. Most of all I believe the Income Tax Act net needs to be broadened. If that happens everyone would then pay their fair share of tax. Ultimately the need to curb the increase of house prices and to broaden the tax rules are what the process should be all about. This bill takes an extremely minor step in the right direction and it is actually a shame that the Government does not have the guts to adopt the rest of New Zealand First policy.