Seymour DavidDAVID SEYMOUR (Leader—ACT): Thank you Madam Speaker. I rise on behalf of ACT in support of this Resale Right for Visual Artists Bill very hesitantly and only for the first reading. For people following along at home and at Ryman and other villages up and down New Zealand who watch Parliament TV what is this bill about? Well this bill says that if somebody creates a piece of visual art—and it could be a number of prints it could be a painting it could be a carving—then for 50 years after it is created if one person sells it to another then 5 percent of the resale value excluding GST incidentally and excluding any buyer's premium must be sent back to the artist or their estate. On the face of it when you think about poor starving artists and particularly those artists who may not have their brilliance discovered in their natural life or at least not at the time they produce their works it seems like a reasonable thing to do. The problem is that we have far too much bureaucracy and far too many laws and requirements that people are required to spend far too much time complying with in this country and not enough time actually producing valuable stuff. This law is a perfect example of that because we had a Government that only two or three weeks ago said it was going to return us to bread and butter issues and now it is trying to make sure that people get royalties after the fact on paintings. And the question you might ask is—Hon Members: Bread and butter for artists.DAVID SEYMOUR: And the Labour Party say this is bread and butter for artists. I mean this is how desperate and deranged the Labour Party has become. They're now seriously trying to say that this bill is being done to help starving artists with their bread and butter. Give us a break—give us a break. Let's get to the purpose of this legislation. ASSISTANT SPEAKER (Hon Jenny Salesa): That'd be great. Let's come back to the bill. DAVID SEYMOUR: Thank you Madam—well actually with the greatest of respect Madam Speaker I've been discussing the bill the whole time. I've returned to discuss some heckling by the opponents. It's unfair of you to characterise me as not speaking about the bill. The reason for this bill can actually be found in the regulatory impact statement and what it says is: What is the context behind the policy problem and how is the status quo expected to develop?" "Diagnosing the policy problem". And it's very simple. It says "The UK FTA commits New Zealand to introducing a reciprocal ARR scheme." So this doesn't make sense. It's not a bread and butter issue as the Labour Party just tried to describe. It is being done according to the bill notes that the Government produced and the regulatory impact analysis that the Minister for Arts Culture and Heritage has produced—it's quite a thick piece of paper a lot of paperwork a lot of bureaucracy in producing all of this. It's been done because our Government signed up to a free-trade agreement (FTA) and agreed with the European Union that they would do this and now they've come to Parliament and said "Can you please do it? Because we made this commitment."That's why ACT is reluctantly supporting this bill because we're free-traders and we appreciate that we have to keep promises that the Crown has made on New Zealanders' behalf overseas to maintain the credibility of our whole country. So that's why we're doing it for them. But I just ask a simple question. You know if the United States Canada Switzerland Japan and Korea—that's a substantial portion of the entire world economy—do not have such a scheme as this was it really necessary that New Zealand signed up to one when negotiating to try and sell a bit more butter and beef to the French? To give you an idea of why they insisted on it this goes back to the late 19th century. That is the late 1800s when a resale right or as they say charmingly droit de suite—which is French for right to follow—was introduced. So this is a nearly 200-year-old French law. That's why we're doing it. It doesn't stack up. It doesn't make any sense. It is not what the French would call du pain et du beurre— the bread and butter. It is something that they are being forced to do because they signed up to a free-trade agreement without looking at the details. So now New Zealanders will face additional bureaucracy for almost no benefit and I say "almost" because here's a few predictions. You see if you put a 5 percent tax on something and that's what this effectively is—Angie Warren-Clark: What tax?DAVID SEYMOUR: —a 5 percent tax on selling an artwork which then must be transferred to a particular beneficiary—well when the Government puts a tax on something and the Labour member says "What tax? What tax?" let's have an economics lesson. You know when the Government forces a person to pay as a condition of doing something that is a tax—that is a tax. This Parliament's been asked to make a law saying if you want to sell between a professional art dealer and another professional art dealer then 5 percent extra must be paid for a specific purpose. That is a tax and when this Parliament puts a tax on something one of the things that happens is people end up paying or being prepared to pay less for it. So one of the things that's going to happen is that when someone buys an artwork from an artist in the first place they know that they're going to get less revenue when they sell it because of this new tax.So one of the things that's going to happen ceteris paribus—that's Latin for the Labour members that actually got rid of Latin from the curriculum—other things being equal is that actually artists will be worse off when they sell their art the first time because there is now a 5 percent tax on every resale. So when you look at "Are they going to be better off overall?" well actually not so much. Here's the other issue. This tax only applies if a professional art dealer is involved in the sale. So it's going to create the incentive to actually do sales off book because if you're buying a $1000000 painting if you avoid this that's $50 grand. Are people going to find ways around that? Of course they are and that's another layer of bureaucracy involved in avoidance behaviour. And you know what I find interesting? It's that we're at a time in our history when this country faces many challenges but in order to raise rational debate and rational objections on basic economic grounds do the Labour Party listen and say "Oh well that's an interesting point."? No you could hear them before. They're quieter now because they've run out of things to say. But you could hear them before rabbiting on raving and that's why we don't have decent discussion in New Zealand. That's why we're losing our ability to problem solve. So we actually need to ask ourselves is this the right law for New Zealand? And is it needed in light of the free-trade agreement with the European Union? That is why ACT is supporting this law to the select committee. But the question we'd like an answer to is: what happens if we don't pass this law in respect of our free-trade agreement? Because we already know it's a bad policy. It's just going to distort the market and lead to avoidance behaviour and additional compliance and bureaucracy more people employed in Wellington. I'm sure the Ministry for Culture and Heritage think it's fantastic. They'll need a new office to administer it. However we're going to find that we have a more bureaucratic country with less benefits than people think and as a result of that we're going to have to ask ourselves a question of the select committee: is this actually necessary in order to comply with the conditions that we have signed up to in the European Union FTA? I think it's up to Parliament not just to go along with whatever it is that the executive signs up to but actually scrutinise commitments that the Crown has made and send a clear message to the Crown that if you go and sign up to international agreements with other bodies outside New Zealand then you're putting New Zealand's credibility on the line and you better have got it right. And if you absolutely can't wriggle out of this then unfortunately Parliament is going to have to put a whole lot more 200-year-old French bureaucracy on to New Zealanders. However if there's a way out of this where New Zealand can avoid this bureaucracy where New Zealand can actually carry on as a free and open society just by that little bit of difference of this one law then I think we should be asking how we can do it.So the ACT Party will support the law to go to select committee. We look forward to hearing from people. No doubt there'll be people from the artistic community. We should listen to them. There'll be people in the art-dealing world. We should listen to them. There'll be people from foreign affairs and trade and we should listen to them. But what is important is that New Zealand does not accept additional bureaucracy for no benefit when it's not even required by our international obligations. And if that is the case we will be opposing later stages of this bill. Thank you Madam Speaker."