Goldsmith PaulHon PAUL GOLDSMITH (National): Thank you Mr Chair and I want to talk about two things in relation to this part. One is the question of broken promises and the second is the consequences. That Minister David Parker who was just standing up of course is on the record wanting a capital gains tax. He's always advocated for it and wanted it and thought it was the best thing for New Zealand. He was part of a party that lost two election campaigns on it. During the previous election campaign his successor Grant Robertson promised black and blue there would be no further tax changes beyond the increase in income tax for people earning over $180000 and some potential petrol tax increases. So what do we find here? We find here in this piece of legislation a significant extension of the brightline test. Yes National introduced the brightline test for two years to deal with the specific issue of people flicking properties and wanting to clarify the law in that relation. This extension to 10 years is unquestionably a significant tax change and an expansion into a capital gains tax in effect. Then we have also a separate significant change in not allowing the deduction of interest payments for rental properties. So it's always been said that in the third term of a Government arrogance seeps in and what we're seeing in this Government is a quickening of that electoral cycle so that in only the first year of the second term this Government is showing overweening arrogance and breaking promises left right and centre. A couple of weeks ago we had that over the Māori wards where there was a clear promise to give local people a say on matters affecting them and then that was broken with the legislation that was rammed through in urgency. And now two weeks later we're back in the committee again under urgency breaking another promise that was brought through in the election. So I suppose I have to ask the Minister how on earth he thinks that New Zealanders will be able to believe anything that this Government says if they're in the habit of breaking promises.The second thing I wanted to raise was the question of the outcome of this legislation because it's my experience that about 50 percent of the laws passed in this Parliament achieve the exact opposite of what they set out to achieve and that is because the world is very complicated and it's hard to predict what the consequences of the legislation are particularly in matters relating to tax law. So that is why the general process is to spend a lot of time in a formulaic and laid out manner consulting with those people who deal with this day in day out and understand the nuances of what's going on so as to reduce the odds of the legislation bringing the exact opposite effect to what we want. We're not doing that. What we're doing is we're ramming this through under urgency.So what will be the consequences of significantly reducing the returns to landlords for properties that they own? It's quite possible it seems to me that in conjunction with a whole lot of other things that have happened in the rental property space this will lead to higher rents and that will make it more difficult for New Zealanders to have access to affordable housing. It will make it more difficult for families and their children to be able to get by. We've heard a lot about this Government's intentions around reducing poverty and they're going backwards at a rate of knots in so many measures primarily because of the cost of housing and primarily because of the cost of rental housing. This legislation it seems to me may well compound that problem—in fact make it considerably worse—given the fact and the Prime Minister has admitted that the officials don't really have a clear sense of what the consequences will be for rents. They don't know and so we're going to take a bit of a plunge here but we do know that there's been about half a dozen things passed over the last couple of years adding costs to landlords and they have flowed through to rents. We do know that it's made it much more difficult for landlords to deal with unruly tenants and that has quite naturally led to some people getting out of the industry and that has compounded the shortage of supply. And we know that it's difficult to magic up a whole lot of new houses and so in a period of constrained supply the most natural thing is that the prices will go up. And so what we have here is broken promises and the risk of higher rents.