The Property Council, which represents commercial and industrial property owners, has called on the government to allow property owners to claim a tax deduction on losses incurred because of the Canterbury Earthquake.
Property Council chief executive Connal Townsend said many property owners had buildings that were significantly damaged in the earthquakes and many buildings would need to be demolished.
“Current tax law prohibits property owners from claiming this tax deduction. However, we believe there was a precedent set after the Bay of Plenty floods in 2004, when the then Labour government granted a waiver," Townsend said.
“This effectively allowed a tax deduction to be claimed for the difference between the insurance proceeds and the tax book value of the building prior to the adverse event,” he said.
The Property Council said it also endorsed a proposal by KPMG that clarifies that costs incurred in demolishing buildings that are structurally unsafe or uneconomic to repair are deductable for tax purposes.
“New Zealand’s tax system should compensate where New Zealanders suffer real economic losses,” he said.
“It’s important that every step is taken to ensure Canterbury residents and businesses are able to recover from the tragedy that has occurred in recent weeks.”
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.