9. Tax System—Negative Gearing and Property SpeculationPHIL TWYFORD (Labour—Te Atatū) to the Minister of RevenueTax System—Negative Gearing and Property Speculation9. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Revenue: Does she agree with the IMF that removing negative gearing" tax breaks for property investors would help redirect saving incentives to other potentially more productive investments?Hon JUDITH COLLINS (Minister of Revenue): No. The member has got it wrong. The IMF does not describe the rules as a tax break. The rules applying to property are in line with the laws applying to other forms of investment.Phil Twyford: What benefit is there to New Zealand from giving property speculators tax advantages—Hon Steven Joyce: Especially if they have Chinese-sounding names eh Phil?Phil Twyford: —wait Steven—when negative gearing is primarily used by offshore speculators with 35 percent of them not paying any tax at all?Hon JUDITH COLLINS: This Government does not intend to tax people on income they do not earn.Phil Twyford: Why should we allow speculation in our housing market to lock out first-home buyers given that sales to property speculators with five or more houses in Auckland now make up more than one in seven of all sales?Hon JUDITH COLLINS: For a start just because someone owns more than one house does not make them a speculator. That member should just ask some of his own colleagues in the Labour Party about that. [Interruption]Mr SPEAKER: Order! We will have just the supplementary question.Phil Twyford: Why should we subsidise speculation on property for the wealthiest people given that 40 percent of the tax avoided through negative gearing goes to the top 10 percent of income earners?Hon JUDITH COLLINS: Obviously we do not. We just do not expect people to pay tax on income they have not earned.Phil Twyford: Why will National not crack down on property speculators when they are driving up house prices and denying young Kiwi families a chance of ever owning their own home?Hon JUDITH COLLINS: I do not know where that member has been but in the last 7 years this Government has introduced a number of changes that have tightened the tax rules on property. In 2010 we removed the depreciation on buildings. Since then the amount of positive rental income received by landlords has increased by 53 percent and net losses have fallen by 14 percent. We have increased the taxation on short-term speculative property investment through the brightline rule. This taxes gains from property bought and sold within 2 years and imposes a withholding tax of 33 percent on property sales for non-residents. In a number of Budgets—Andrew Little: Tell us about homeownership. What's happened to those rates?Hon JUDITH COLLINS: —and I note that that member has never voted for one of them—we have taken steps to make sure that the Inland Revenue Department has extra funding to make sure it can enforce the tax rules in the property sector.Phil Twyford: I seek leave to table data provided by CoreLogic that shows that one in seven property transactions in Auckland is going to property investors with more than five properties.Mr SPEAKER: Is that information publicly available?Phil Twyford: I do not believe it is.Mr SPEAKER: The member is expected to know because that question will be put.Phil Twyford: It is not publicly available to the best of my knowledge.Mr SPEAKER: On that basis I will put the leave. Leave is sought to table that information done by CoreLogic. Is there any objection to it being tabled? There is objection."