Dunne Peter: Taxation (International Investment and Remedial Matters) Bill — In Committee 
Dunne Peter: Taxation (International Investment and Remedial Matters) Bill — In Committee 
[Volume:677;Page:461] 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I am happy to oblige the member. I do recall the trip we made to the Duke of Marlborough Hotel in Russell to meet a number of wealthy expatriates who had come to this country as their bolthole and who were enjoying the benefits of their earnings and investments at that stage. The fair dividend rate regime effectively said we would tax them on a portion of the gain provided they were outside Australia—because the member will recall 70 percent of New Zealand offshore investment at that point was into Australia so the people who were going to be caught by this were those outside the Australian regime. Most of these people of course were Americans and Canadians and Europeans— 
Hon David Parker 
: Not used to paying tax. 
Hon PETER DUNNE 
: —not used to paying tax—and even more incensed that this was a Government policy which was broadly supported by all sides of the House that might require them to pay some. My overriding recollection of that meeting and I am sure the member recalls it was that there was one group of people in the front who were being very nice and reasonable and trying to go through all of the arguments without actually portraying their real intent. Right at the end of the meeting I think it was a Canadian woman who got up and said: “I’m sick of what I’m hearing. I’m hearing all these people talking about fairness and equity and paying their taxes. We’re wealthy people. We shouldn’t have to put up with that nonsense.” The consensus that had been built during the meeting about trying to work our way through was destroyed by the selfishness of this particular individual. 
Hon David Cunliffe 
: Was that Michelle Boag? 
Hon PETER DUNNE 
: No it was not.  
Having said that we did develop a regime that was fair and reasonable. What I have been trying to say in earlier parts of the discussion on this Taxation (International Investment and Remedial Matters) Bill was that this is part of an overall package of reforming our international tax rules. The member made reference to Mr Gibbs and it was the Brierley—Guinness Peat Group— 
Hon David Parker 
: GPG. 
Hon PETER DUNNE 
: —GPG—over the cotton manufacturers whose name I temporarily forget. The member will recall we gave it a 5-year exemption that if it could prove that within that 5 years that Guinness Peat Group or—the name—Coats the cotton people were substantially located within New Zealand then it would be exempt from the regime. I should tell the member that what happened—because the 5-year anniversary was last year—was that Mr Gibbs or his successors quietly have let that one go. So the argument was that it was a substantially New Zealand company and that therefore it had to be exempted when we said: “You have got 5 years to make the transition.” At the end of the 5 years it came back and said: “No we are quite happy with things as they stand.” So that was the outcome on that story.  
I just want to make a comment about the amendment that has been put forward by Mr Parker. If I read it correctly what he is seeking to do is to hold the rate of the approved issuer levy at 2 percent. 
Hon David Parker 
: Yes—omit clause 142. 
Hon PETER DUNNE 
: Yes. So in effect what clause 142 does is give us the mechanism to strike it at zero. He is simply saying remove that—hold it at 2 percent. Well that is contrary to the intent of the bill. The Government will not be supporting that and I would suggest to Mr Parker that what he has proposed is a rather elaborate mechanism. If he is opposed to going from 2 percent to zero he should vote against that part.