Wagner Nicky: Border Processing (Arrivals and Departures) Levy Bill — First Reading Second Reading In CommitteeText is incorporated into the Bound VolumeWagner Nicky: Border Processing (Arrivals and Departures) Levy Bill — First Reading Second Reading In Committee[Sitting date: 21 May 2015. Volume:705;Page:3897. Text is incorporated into the Bound Volume.]Hon NICKY WAGNER (Minister of Customs):The New Zealand public told us they wanted a safe border. They want to make sure that it is secure against illegal people and illegal goods—that is drugs firearms and objectionable material—and they want us to manage biosecurity risks such as fruit fly and foot-and-mouth disease and that is what this levy will do. This levy in the Border Processing (Arrivals and Departures) Levy Bill will amend the Biosecurity Act and the Customs and Excise Act and it will impose a border clearance levy for arriving and departing passengers.I want to make it very clear that this levy is only cost recovery. It will be put into a trust account. It will have nothing to do with the Joint Border Management System because the Joint Border Management System deals with goods. This is to do with passengers and the Joint Border Management System deals with goods and Joint Border Management System goods have always had a levy. Goods have had a levy since the early 1990s so this is exactly the programme that we are going to introduce for passengers as well.I want to start by answering Mrs King’s question: what is the difference between a levy and a tax and why is it absolutely consistent that the Prime Minister has attacked the UK carbon tax and is absolutely supportive of this cost recovery levy? New Zealand’s cost recovery levy is about $20 maybe $22 and that reflects the cost that the New Zealand taxpayer is subsidising for every single passenger who comes across our border. The UK tax is about $150 and although $20 of it may be used for a border levy the rest of it is a carbon tax and it was designed to be a carbon tax. It is a carbon tax on distance a carbon tax on air miles flown for long-haul passengers. Of course that is calculated on the number of miles and that is particularly tough on a country like New Zealand on the opposite side of the world.At the moment if you look at the status quo in New Zealand it is a lose-lose for New Zealanders. Every New Zealander is paying for other people to come across our border. Then on top of that when New Zealanders go to another country they have to pay to go across others’ borders. So not only are we paying for our own borders but we are also paying for everybody else’s borders. That is lose-lose. This change will mean that it is best international practice and it will bring New Zealand into a place that is much more satisfactory for New Zealanders.I would also like to explain to Mr Lees-Galloway about the cost of this. It is all to do with addition. What our press release said was that it is going to cost $16 at arrival. The levy is $16 at arrival and $6 at departure. The reason for that is that there is much more work at arrivals than there is at departure because we deal with biosecurity at arrivals rather than at departure. But instead of it being inflationary as he seems to think it is actually going to be deflationary because I think it is probably going to end up at about $20. We believe it is $20 well-spent for New Zealanders to protect our borders. Just let me make it very clear. This is in comparison with Australia which is $58 and the UK which is $150.Let us now have a little bit of a chat about the Joint Border Management System. I would like to answer Mr Shearer’s queries and Mr Tirikatene’s questions. The Joint Border Management System is working well. I will make it clear again. It manages goods not passengers. Goods have always paid a cost levy. So this levy actually brings passengers in line with goods. I am really pleased to be able to announce a really good news story. Right now we are able to tell you that the Joint Border Management System has just reached 2 million transactions. I did put out a press release about this time last year when we got to 500000. But we have now got to 2 million transactions.Stuart Smith: Wow 2 million.Hon NICKY WAGNER: Fantastic. And on top of that exporters now have the ability the tools to be able to register online themselves. In the past it used to take 24 hours to register online. They can now do it within minutes. That is a fantastic improvement for the Joint Border Management System. I would also like to tell you that every week more companies are transferring to WCO Data Model 3 which is the new data protocol. This is cutting-edge latest technology latest data protocol and every week more and more of our transactions through the Joint Border Management System are moving that way.I would just like to make the point that the Customs Service is 175 years old this year. It is the oldest department—175 years. We are also dealing with cutting-edge technology cutting-edge IT and I think it just goes to show that you can teach old dogs new tricks.Also I would like to make a comment for the member Steffan Browning. He was concerned about private yachts. This levy will be in place for private yachts private aircraft and anybody who comes across our borders. As it is now every yacht and every aircraft that comes into New Zealand goes through the customs process for arrival and departure and we will collect the levy at that time. So he needs to understand that we will be doing a good job.Finally I want to get back to Rino Tirikatene again. I just want to tell him that we are not taking biosecurity or security at our border lightly. He seems to think we take it lightly. He probably has not realised that we have actually put $30 million in this Budget on top of this levy to beef up what we are doing at the border. So in the meantime this $30 million is going in this Budget. I also want to tell him that nobody seems to believe that this will make a difference to tourists’ behaviour. This cost is less than 1 percent for a long-haul flight and it is only one of thousands of variables that people have when they travel. For example how much does it cost you to get to the airport? What do you eat at the airport? What do you buy duty-free? What do you spend on entertainment on the plane? What do you spend in your country? The interesting thing is that I had a look at some research that said that in the last month the average Australian visitor to New Zealand lost more than $20 just on the exchange rate between Australia and New Zealand. So this is not going to make a difference. In fact I have a quote from a well-respected tourist leader who says “It won’t make a blind bit of difference.”I just want to summarise why this levy is so important for New Zealand and why New Zealanders should be pleased to see it. First of all it is flexible and futureproof. As the numbers of passengers and travellers increase across our borders the resources will be there to manage them. As we get more and they are more risky we will be able to make sure that we keep our borders safe. It is also fairer. I have explained that at the moment every New Zealander every Tom Dick and Harry is paying $23 in their tax to subsidise international people coming across our borders—people who are on a luxury cruise people who are coming to play golf in New Zealand. So why should the Whangarei panel beater or the solo parent in Christchurch pay for these people to come across our borders? What we have got now because the rest of the world is putting on these levies is a lose-lose for all New Zealanders.I just want to make one little reflection before I go. Before I was an MP I did not used to like paying tax. I think it was because Labour was in power and I did not trust the way it spent the money. But now I do understand where the money is going I know that it is spent wisely and I do not feel so bad about our tax. Most New Zealanders want their tax money to go to something useful. They want it perhaps to go to poorer families. They want it to go to hip operations. They want it to go to education. People like their taxes to go to something useful not to subsidise international passengers. So this levy is good for New Zealand it is good for New Zealanders and I commend this bill to the House.