Nash Stuart: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — In Committee 
Nash Stuart: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — In Committee 
[Volume:666;Page:13445] 
STUART NASH (Labour) 
: 
 I would like to say just one thing: I did not hear the Hon David Cunliffe say that the Labour Party was going to introduce a capital gains tax or a land tax. The reason I did not hear that was David Cunliffe did not say it at all. 
I have put forward a typescript amendment to the Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill. The intent of the amendment is to exempt local authority rate payments for residential properties due during the 2010-11 financial year from the GST increase legislated to come into effect on 1 October 2010 and I urge the Government to support it. There are two reasons why I have introduced this amendment. The first reason is that I have a very real concern about the impact of the GST increase on the vast majority of New Zealanders and the second reason is that I believe we need to do something about that. 
The Government has already recognised that the increase in GST will cause a number of issues for taxpayers. Accordingly it has introduced amendments to exempt a number of contracts and transactions such as 5-year finance leases lay-by sales and insurance contracts from the increased GST rate over a transition period. Local authority rate instalment payments are similar in principle and practice. They are a contract between the local council and the homeowner for which an invoice has already been sent. Although councils are offering to charge a GST rate of 12.5 percent to ratepayers who can pay their bills in one lump sum as they fall due on 1 July many New Zealanders are not in the position to take advantage of that offer. Those who are unable to pay in full will be required to pay some of their annual rates bills at the current 12.5 percent GST rate and some at the new 15 percent GST rate which puts them at an additional disadvantage compared with those able to pay in full. Essentially those who are least able to afford it will be required to pay more. I do not think this is fair. 
This amendment amends the bill to ensure that no ratepayer is unfairly disadvantaged by the increase in GST over the transition period. I make the point that times are tough for many hard-working New Zealanders at the moment. I take the example of the Napier electorate where the median income is only $22700 which means that 73 percent of people in Napier earn below $40000 a year. Napier is a city typical of many around the country where a significant proportion of the population will see very little if any benefit from the 1 October tax cuts. When we add in the impact of the GST rise we know that the family budget will be stretched to breaking point. 
Many of these fine people are however living the Kiwi dream; they own their own homes. They have saved hard and they take pride in the fact that they are bringing up a family or have brought up a family in their own house. However the cost of owning that house is about to increase. Residents by and large understand that rates go towards paying for essential services in the community. This time however a portion of any increase will not go towards improving their communities; it will go into the pockets of the Government in the form of GST. 
Times are tough out there and people who doubt this should go and talk to the budget advice services operating in their communities. I have and I do it on a regular basis. I know that the fantastic people in those services are beginning to see a different type of clientele such as homeowners who have lost their jobs that once provided good incomes and that is of huge concern. I urge the Government through the Minister of Revenue to cut the good people of New Zealand a bit of slack and support this typescript amendment that exempts local authority rate payments due during the 2010-11 financial year from the GST increase legislated to come into effect on 1 October 2010. That is fair that is just and we are on the side of the angels here. We do not want the good hard-working people of New Zealand to be disadvantaged any more. I urge the Government to support this amendment. Thank you.