Carter David; Rurawhe AdrianRt Hon DAVID CARTER (National): It's a pleasure to follow on from the Hon James Shaw and let me take this opportunity of explaining why National will oppose this legislation the Taxation (Annual Rates for 2019–20 GST Offshore Supplier Registration and Remedial Matters) Bill. He has correctly pointed out a number of smaller remedial matters that are good in this bill. The reason National will oppose the bill is simply because of Part 1 which establishes the huge tax take that this Government's intent on taking from New Zealanders. So if Mr Shaw was prepared tonight to remove Part 1 from the legislation he may well get National Party support for the balance of the bill but I doubt whether that's going to happen at all.Let me explain quite clearly why I oppose this legislation and the tax bill part of it Part 1. It is because this legislation will soon be seen as a lost opportunity. The economy in this country is in decline. I know that Labour members and Green members and New Zealand First members refuse to recognise that although I did note today the Prime Minister herself has acknowledged that the economy is now declining. She then goes on to say the reason for the decline is entirely because of offshore factors—that other economies around the world are declining and that will have an effect in New Zealand.There is another argument advanced by many commentators that the reason the New Zealand economy is in decline is because of the anti-growth policies that have been enacted by this Government over the last 18 months. Now I will suggest to the House tonight that the truth is somewhere in between. The reason the economy is in decline is certainly because of the Government's focus on anti-growth measures its focus on making sure it's making it a lot harder for businesses to do business here in New Zealand and it is certainly a factor of the overseas trends. But one easy way to stimulate the economy would actually be to provide tax relief at this time. If the Government won't look at that opportunity then I think not only is it establishing tax rates that continue—we're seeing now more and more people via bracket creep move into the highest tax rate: $70000 and everybody's in the highest tax rate. I took the opportunity of asking the Minister when he was in the chair last night how many people that is. He had no idea. I find it incredible that a Minister of Revenue can sit in the chair through the committee stage and not be able to answer a simple question as to what numbers of taxpayers are now in the highest tax rate.The effect of cementing these tax rates in is this massive increase in tax revenue over the next five years. We currently in 2019 are predicting tax revenue from GST and from corporate tax and from personal taxation of $84.7 billion. Over the next five years that amount grows by a staggering 29.9 percent. That figure balloons out to $105.6 billion and that's one of the major reasons why this economy is in decline. No Government member has acknowledged that massive ballooning of tax take that's in the BEFU—in the Budget Economic and Fiscal Update—page 26. We had a discussion at the Finance and Expenditure Committee today and again Labour members around that select committee table are in absolute denial of the huge increase in tax that this Government's ramping up with this bill.There are a couple of other issues that I want to discuss around concerns for this bill. I agree—and in fact most National members have mentioned in their contributions tonight that we agree—with the move to put GST on to the internet shoppers. In fact the preparatory work for this was done by the previous National Government under the then revenue Minister the Hon Judith Collins. But what I do strongly disagree with is the date by which Amazon TradeMe eBay and other suppliers are meant to concur with this legislation. It came into the House and was meant to be applied from 1 October. They all said We want to comply. We will comply. We'll collect the GST via systems that we'll adapt to do that job. We'll remit it to IRD here in New Zealand but we need time to set it up." and they suggested that that should go through to 1 April. The Government gave them an extra two months under pressure from National members around the select committee. So we've moved it from 1 October to 1 December. That still in my mind will make it difficult for companies that want to comply and the alternative if they haven't set up the systems to comply is to simply not make available those internet goods to shoppers from New Zealand disadvantaging New Zealand consumers.The third aspect that I worry about with this bill is the ring-fencing on rental properties. Again it's because there's this instinctive lack of knowledge of what ma and pa small mum and dad investors do when they purchase a rental property with the sole intention of making some money over a period of time but making it available to the rental market. I've heard speeches from the Hon James Shaw tonight from the chair of the Finance and Expenditure Committee Michael Wood and neither of them can refer to these people as investors without also referring to them as speculators and that's what's driving this particular move. Labour New Zealand First and the Greens see all these small-time mum and dad investors in small rental properties as speculators. Most of them aren't. They buy their property. They probably spend some money renovating it to get it up to standard immediately. They then go through the hassle of getting a stable tenant into the property and for the first year or two may well make a loss. The advantage to them of doing that had previously been they could write that off against other income. The Government is going to stop that and that has an effect that's already being seen by these smaller investors keeping out of the market meaning less properties are available for rent and that's why we're seeing rents go up a staggering $50 a week. Here these people who are renting properties can ill afford the rents as they're established now and this move will only see rents increase still further. The final aspect that I want to address in my contribution is the Supplementary Order Paper (SOP) that the Minister of Revenue tabled in the House late last night which makes adjustments to the Land Transfer Act and members have described it as simply requiring purchasers and sellers to give their GST number. I have no problem with that aspect of it at all. The part that I am particularly worried about is that in this particular SOP that's been tabled there's now a definition as to the main home transfer and a definition that says that a seller must prove to IRD they've lived in that house 50 percent of the nights that they've owned it. I think that will be absolutely impractical to do. I sense what they're trying to do is close a loophole around people arguing when they should be paying the brightline test tax that it's actually a personal dwelling. Then if that's the case close the loophole properly. But I think actually they've created in this legislation a massive difficulty for people to prove—I can think of somebody who's effectively a travelling salesman who might spend four or five nights a week away from their principal dwelling now not being able to say it's a principal dwelling because they didn't spend 50 percent of the nights and they might own that property for say 10 years. That person is going to have difficulty proving what is generally a principal family home to be a family home because of this legislation. We could have fixed these sort of anomalies if Mr Nash had allowed this SOP to go before the select committee and that's why tax legislation requires the work of a select committee. To put it into the House late last night and expect it to be passed without discussion will be foolhardy.ASSISTANT SPEAKER (Adrian Rurawhe): I understand this is a split call. I call Willow-Jean Prime—five minutes."