Key repeats idea floated in July last year that a land tax on non-residents would not conflict with FTAs; says no decision made; says land tax common overseas; Twyford says Key tinkering and outright ban better

Key repeats idea floated in July last year that a land tax on non-residents would not conflict with FTAs; says no decision made; says land tax common overseas; Twyford says Key tinkering and outright ban better
Prime Minister John Key talking to reporters on April 12, 2016 in Parliament. Photo by Lynn Grieveson for Hive News.

By Bernard Hickey

Prime Minister John Key has refloated the idea of a land tax for foreign buyers over the long weekend, talking in interviews about the potential for such a tax just a month out from the Budget.

Key floated the idea of a land tax on foreign investors on July 26 last year, and added in follow-up comments the next day that a land tax was more acceptable under New Zealand's Free Trade Agreements than outright bans on foreign buying and that such a tax was possible before the 2017 election.

He said in July that he wanted more data on the extent of foreign buying before further consideration by Cabinet.

LINZ is due to release its first batch of information from the October 1 start of the identification of non-resident buyers within two weeks and the release of REINZ data for March on April 12 has again ramped up pressure on the Government to look at more demand side measures.

Key was quoted yesterday in this Stuff piece as saying a land tax was an option if foreign property speculation became a "runaway train."

He said any such tax would apply to non-residents regardless of citizenship, meaning it would also catch ex-pats with property here. He was quoted through a spokeswoman as saying a discriminatory stamp duty on non-residents from some countries and not others would breach New Zealand's FTA with Korea and its double taxation agreements with Australia, Japan and Mexico.

"Land taxes are considered direct taxes and non-discrimination obligations in FTAs are not applicable to these type of taxes. Also a tax on "non-residents" would capture some New Zealand citizens as well as foreigners as it would be applied on the basis of residency not nationality. In that case it would not necessarily constitute discrimination for the purposes of our double tax agreements," Key was quoted as saying through a spokeswoman.

Key said he did not have early indications of the numbers from the October 1 disclosure changes, but he said his gut instinct was that the buying by Chinese buyers in Auckland was by Chinese living in New Zealand.

"We've always said 'look if the thing became a runaway train on us and we were really concerned about it, that's always an option available. And to be blunt, actually, land taxes are far more likely to deter people than a stamp duty," he said, adding that stamp duty had to be paid once while a land tax had to be paid annually.

"Lots of countries have land taxes."

Possible 3 year exemption for ex-pats

Key told the New Zealand in an interview that the land tax could apply to ex-pats after a three-year exemption.

"Subject to our capacity to do so, New Zealanders living abroad would be exempt, but you could do it for a period of three years at which point if they retained the property, they might have to start paying [the tax]," Key was quoted as saying in a piece describing his comments as a dramatic change in position.

'Classic John Key'

Phil Twyford described Key's comments as more tinkering and reiterated Labour's position that it would just ban foreign buyers.

“This is classic John Key. Just enough to get the issue off the front page. Just enough to make it look as if he is doing something," Twyford said.

“The Prime Minister is a day late and a dollar short. He has been rubbishing Labour’s policy for the past three years, and denying that foreign speculators are even a problem. He refused to even try to negotiate a carve out for a ban in the TPPA. And now he has some complicated land tax idea that would apply to Kiwis who happen to be working or living overseas," he said.

Meanwhile, the Victorian State Government announced on Friday it would more than double its stamp duty surcharge for non-resident buyers from 3% to 7% from July 1 and would triple a land surcharge on absentee owners from 0.5% to 1.5%.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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.

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12
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Ha.
If I were a betting man, I'd punt that someone has had an early briefing on the numbers by LINZ.
Could just be coincidence though. I mean, it's unlikely that JK would ever back track on any of his positions. Isn't it..?

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very much so, that and he wont close the door so next best thing is make money off them, shows how much he cares about NZ citizens (apart from those profiting)

Possibly, although the stuff article quotes him as saying " I could be proven to be wrong but my gut instinct tells me that the buying that's happening in Auckland ... [is done by people whom he thinks have] got residency. They may or may not have citizenship." If he had been briefed then I don't think he'd state his gut instinct was contrary to what he knew.

It was interesting that he seemed to acknowledge that people of Chinese ethnicity (his words not mine!) may be driving the market but that he thought they were NZ residents.

Yes totally agree, looks like Mr Key is finally going to admit to the scale of Chinese non resident property investors in Auckland. But how this can be effectively controlled is going to be very tricky, there's only one main control that they can put in place (By basically copying the UK Non-Resident tax system), and that's through Capital Gains Tax.

A much better policy is to follow Oz and only allow Non-Resident investors to invest in 'new building programs' and NOT existing builds or completed new residential builds. This would help to boost new housing investment for NZ.

And we have to do this sooner than later, has everyone seen this latest article in NZHerald: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1162...

He is 'shape-shifting' to lead the public to a place where he will only include investors permanently living in China with no family or business connections in NZ. That will firewall off all the messy & mixed examples and lower the percentage.

The for-profit ventures regarding housing continues to hurt New Zealand's economy; it is putting pressure on low income earning families and causing further inequality. It's too late for any remediation, but putting the brakes on any housing investment from not just foreign investment but local investment into housing should be considered - and i personally don't think a tax would help this.

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Why are Twyford and Key making out that it is somehow "unfair" or unreasonable to hit non-resident kiwis with the tax?

If you've chosen to live overseas and not be a NZ tax resident then you've made your bed - you're not paying income tax here, you're not contributing - why should you get any favourable treatment / tax exemption on a house that you clearly don't live in?

If you're an ex-pat non-resident home owner and don't like this then either lump it or sell up and buy in the country that you've chosen to live in.

In my situation I was hoping to buy a place and get the debt down to a manageable level before moving home.

If house prices were stable it would be a non-issue. Seems there is no escape from a lifetime of kiwi mortgage slavery.

Yes but there are soooo many people who have moved elsewhere and have just kept their NZ house and rented it out in the meantime.

I don't think there is anything wrong with that provided it's just their family home. Why shouldn't kiwis be able to live overseas for a while?

You wouldn't want to be at the whim of the Auckland housing market.

Right, it doesn't seem unreasonable to have an exemption for a family residence you don't want to give up as opposed to investment property (ies?) you may have never lived in for any length of time.

It isn't really their family home if they aren't living in it though. The three year rule Key suggested seems a good compromise to me.

.

This is a strange hill to stand on. You're saying that a resident landlord who offsets their personal income from losses on their rental *is* a meaningful contribution? As a side note AFAIK the non-resident landlord would still pay income tax in NZ on their rental income.

No, I didn't say that at all - strange that you're putting those words in my mouth.

I don't think that residential property investment is, in any way, a meaningful contribution. And I am very much a free market advocate in business.

Any property investor worth their weight will be using negative gearing - so no, they won't be paying tax on income, because there is none.
Don't see why it's such a strange view to hold - it's far more cut and dry when you're non-resident - you're clearly not living in the property, you've gone overseas to earn more money so should be able to cover the carrying cost.
Very similar to interest on student loans - applies when you're out of the country, doesn't apply when you live in the country.

You've got it, it's not a meaningful contribution resident or not. If you don't live in it why not have the land tax? I think in some ways a citizen doing a stint abroad renting out their (single) primary dwelling shouldn't be taxed when comparing to a negatively geared resident multiple house owning landlord. Also it's a stretch to compare this is student loans for obvious reasons.

FFS, don't get me wrong, it would be great to hit corporate domestic landlords.

Let's just stick to the original point, why differentiate between foreign national landlords and non-resident ex-pats? Taxes work best without favour or exemptions - Exemptions just leave rules open to interpretation and ultimately avoidance. Frankly, I don't care of you're a foreign nat or ex-pat - either way you need to be disincentivised to purchase/hold property ahead of residents.

I don't think the student loan comparison is a stretch so I'll stand by it. I lived in the UK with my primary dwelling in NZ for a period, I would have seen sense in the land tax as I did coping interest on my student loan - It's not fun to pay the tax / interest but no one was holding a gun to my head to stay overseas.
I could sell my house if I didn't like the carrying cost - Fundamentally I believe in asset cycles, I don't think that if I hold off buying or exited the market that I'll "miss out forever".

To deal with resident corporate landlords is simple - if you claim interest as a tax deductible expense and residential investment property is used as security then you get charged a land-tax. No way around it - captures people through the most desirable / identifiable element of owning "investment" properties.

Are we going to see Kiwi's living abroad returning to avoid the land tax and as a result add to the pressure on housing?

Why limit this to non-residents? Why not apply it to every piece of land that isn't occupied by its legal owners?

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I think a land tax on second home owners could be sensible measure further down the line. Shooting myself in the foot but there you go!

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headline should probably read,"key reacts to opinion polls again".

Only because the NZ Herald has begun crusading - 6 years late

Completely agree Sammnz and CM. He has just come up with a bit of ineffectual tinkering to keep everyone off his back. It suits local investors to point the finger at overseas investors and immigrants but actually it's all investors that need to be hit to make a difference. Did I hear that 80% properties sales in Otara were to investors last year?

It's just jawboning - buying time - it'll be off the news by Thursday

It will be interesting to hear how much will be raised and how/if it will be used to help first time buyers.

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I can't wait to see how JK spins the stats on nonresident buyers in two weeks time. I'm guessing he will say something along the lines of the proportion of overseas purchases has remained the same so no real issue. Or will it be that the proportion of overseas purchases represents a tiny fraction of NZ total area. Maybe the data will not be released at because his gut feeling will tell him its not representative of what's happening in the market.

I am an expat with a home in NZ. The house is a family house we bought 9 years ago, after struggling to buy it at the 2007 peak. We kept the house and rented it out at a loss. We bought it originally as a home to live in. We will keep it for the kids when they return home to NZ. Any additional tax will mean a greater loss, but will end up increasing the rent long term I expect. We moved abroad to spend time with the ageing family.

Sounds like they are floating a 10% tax. It shouldn't apply to kiwis overseas with just one home in New Zealand.

But key has never been about being fair to kiwis.

a 10% tax? So a bog standard $1m Auckland house will cost 100k a year in tax? I cant see National killing the market like that. Id of thought maybe 0.5% tax. I'd like no extra tax but if they choose one stamp duty is better. Id say all the land owning gentry are in the policy makers ears now about a "land tax".

if you have seen the stats lately the land owning gentry are now becoming a minority in Auckland, where each party needs to win the majority of its votes to gain power.
maybe he is looking to the future election to make sure he gains or retains voters.

Ive seen that National have a 50% approval rating. That's enough to get them into power alone. They cant put in a land tax for Auckland alone can they? That's ridiculous! What ever happens will be on a Nationwide basis.

You know there is a simple solution to this if it's 1) currently loss making and 2) a tax is enacted and it's too expensive for you to hold it - SELL.

Who knows, a young family that is actually LIVING in NZ might want to live there?

Like I said I disagree as a kiwi citizen for your one family home, which you may have a lot of attachment too. Making it available for rent while you are away is a good thing.

It's not the same thing as speculation.

The Poms call it "primary residence". It has a special tax status. They start smashing you on second and investment homes.

You are missing the point. We are keeping the house for the kids in the future. There is already a Kiwi family living in it now. If we were to sell it now, they would have to move out as to buy it would be double the rent, so who do you think will buy it? maybe speculators, which is what everyone is trying to stop. A broad tax will have collateral damage and unintended consequences.

the intended consequence is to bring prices back in line with what locals can afford to pay. your renters then might be able to purchase, do you not want that?
as for keeping for the kids are you certain they will ever return, if so wont be a problem as when they do return then the tax would stop.
also becuase of the loophole you have pointed out once in do you not think a future government will not extend the tax to cover all properties bit by bit.
first second homes next, certain cities i.e auckland then slowly everthing

No its not. The intended consequence is to slow double digit price increases. Not reduce anything.

You are missing the point. We are keeping the house for the kids in the future. There is already a Kiwi family living in it now. If we were to sell it now, they would have to move out as to buy it would be double the rent, so who do you think will buy it? maybe speculators, which is what everyone is trying to stop. A broad tax will have collateral damage and unintended consequences.

I was an Expat and did my utmost to ensure I met the non resident rules when overseas. It always surprised me that an enduring relationship could be as pedantic as a non cancelled magazine subscription and yet keeping the property once occupied as a family home didn't count. Sure it might be rented out but often it was the bolt hole when the expat stint ended so was never truly transformed to an 'investment'. I suspect many would sell their house rather than pay a tax.

@ Engineer11; Yes I was in a very similar situation but coming to NZ from the UK for the same reasons (My other half wanted to be near his very ill and elderly Father) . You're in the 'Reluctant Landlord' camp so I know how it is.

All I can suggest is it sounds as though Mr Key is already considering a similar system to how the UK dealt with ex-pats who are letting out their main home as they move abroad for various reasons.
The whole possible 3 year exemption for ex-pats is basically 'Letting Relief' is exactly like the UK, though the UK did reduce that relief to 18 months last year.

It's very likely that the Land Tax will still be basically Capital Gains Tax on property as the UK closed a tax loop hole for Non-Residents property owners last year. The downside is NZ Capital Gains Tax is currently at a much higher rate than the rest or the world and unlike the UK, we don't have 'Personal Tax Allowance' which allows ex-pats like yourself to claim that allowance (Around £11k = $23k NZD) which takes some of the sting out of Capital Gains Tax on property when you sell.

But the UK does have another card up her sleeve to protect UK Citizens; If you move back in to your property three moths before you sell to 'do up' the property then you're exempt form CGT. So lets hope that Mr Key copies that tax strategy for you.

Great news, go ahead as soon as possible, this will somewhat even the playing field between NZers and foreigners

Also data soon to be released on foreign buyers over the last 6 months will be lower than normal due to the introduction of the Oct 1st rules on property buying

And actually at the end of the day my gut feeling is that overseas buyers are buying a very tiny percentage in terms of our total land including territorial waters

Haha. Territorial waters!
Yep. We sure do have a lot of territorial waters

According to the herald it will be less than 10% of the property and charged annually. Even if it were 'only' 5%, that is a huge annual sum to pay! It would have to encourage overseas investors to another country!

Yes. Its large.
There may be some concerned foreigners contacting their real estate agent as we speak.

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RadioNZ requested the overseas investor info from LINZ, but they are not releasing this now or in 2 weeks, as LINZ have told RadioNZ that they will not release this data until they make the data "Easy to understand". Easy to understand? Does that mean the raw data is not what the Govt wants the public to hear?
No doubt Linz has been updating the Minister & the PM in the meantime.

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What is this data? How hard is it to determine the percentage of total sales by non-residents? Couldn't they have produced this from day one - how has it taken 6 months to still not be ready?

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easy to understand means whoops how do we spin this now

This item in TV3 News last night says everything you need to know about greed. Absolutely disgusting in my view. Who is doing/paying for this and it reeks of "insider trading" In the real estate agents world IMO. Wonder if Key saw it too. http://www.newshub.co.nz/business/auckland-houses-flipped-for-big-profit...

Real estate agents have a long history of targeting (harassing) old folks before their (sometimes distant) families get involved.

Wow, these are awesome profits, wellwell done to the astute guys who pulled it off. I'm not petty & envious, if you think it's easy do the same yourself

sorry not into ripping off old people

Key is a very astute politician and not one that should ever be underestimated......historically NZ has been at a similar point.........this is going to be a long 2 to 3 weeks for this curious notaneconomist!

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Exactly. He will instinctively and smoothly ride through the waves of public feedback, media wash, massaged data eventually drip-fed to a public as the issue fades a little, international pressure from China, with a mix of blokey 'awkwardness" & then full on charm and salesmanship with carefully orchestrated TV clips dubbed by spin doctors until he executes very little.
You have to admire how the International Corporate set & Textor Crosby have netted the perfect vehicle.

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You are totally right and it is embarrassing that my fellow country are so dimwitted to fall for his 'sales speak' and 'blokey awkwardness'. The man is a charlatan.

Oh dear, might need a referendum on the National Anthem. (Dead cat )...Listening John???

If/when land taxes are introduced on our second homes we won't be able to whinge very much as we will have been forwarned about it and been able to sell up at a substantial profit.

once it comes in wont be long before a future government applies it across all land to cut out any anomalies.

That bit sounds like a good way for a future government to become a former government.

Slightly off topic but do investors - holding on to their properties purely for future capital gain - still believe values are going to keep shooting up now we are officially more expensive than Sydney irrespective of income (I believe Sydney incomes are significantly higher than ours).

Yes.
A land tax will cause a small dip/flattening, then back to normal.
Offshore investors are only seeking a safe resting place for their money, not any great returns.
NZ is one of a very few liveable, nice places to live in a very troubled world. With 1000s of kms of ocean as a buffer.

With house prices 9-10 x income. So where does it end? 20 x income or just to infinity and beyond? Personally I think NZ is looking a less attractive prospect for Kiwis looking to return from overseas. I would be looking on in horror. Cities like London & Melbourne are starting to
to look like a bargain.

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Unfortunately a land tax on foreign buyers won't work so long as massive capital gains can be made well in excess of any such tax.
It needs something bigger and harder to make a dent in the run away market and should be imposed on locals as well as foreigners.
A new study by Dr Michael Rehm shows that up to 80% of properties coming up for sale in South Auckland are bought by investors- a very unhealthy situation ( the charts say it all).

http://propertyclick.nz/2016/04/22/what-share-of-aucklands-housing-marke...

Further my studies show that half of these are sales to other investors. Until this is curbed first home buyers and the general public stand no show of getting into affordable housing.

Big Daddy do you think the RB will just sit quiet and let investors put the economy in jeopardy. I am expecting them to tighten up on investors any day. He will not let the current situation carry on otherwise Wheelers reputation is at risk.

His reputation is already blown apart. Why he is so slow to cut rates baffles me.

NZ is known in the world order as one of the "commodity currencies" and with a function for the carry trade, and , supposedly, is forced to run an interest rate premium for being a net borrower.
This is not entirely NZs RB decision independently.
So NZs mortgages are twice the price of US, UK, Germany, Canada etc
Highest house prices in the world, highest interest rates in the developed world, - we are winners - Trump would be proud of us.

Talk is cheap. Actions speak louder than words.

However I too can spin a line.

It is a dogs life. It is dog eat dog world, A wolf in sheep's clothing. A man is a dog's best friend.

Platitudes are now...a mans best friend.

And bull shit is now the Leading Politicians best friend....forever..

But something still doesn't smell quite ...right...does it.??

At least a land tax would help keep our national debt at a reasonable level whilst in many parts of the world it spirals out of control.
As others say talk is cheap. Let's see action first.Tax the foreign owners for now and then second home owners maybe slightly further down the line.

too many holes, i could put one house in my name the next in my wifes the next in one of the kids all not liable for any land tax under JK's senerio

Why phaff about with a tax. I suggest that sales can only be made to citizens. (note it's citizens not just residents) Pretty simple. Over time land and houses currently owned by non citizens would come back into citizen ownership.

It would need to be Permanent Residents as they go through a major vetting process to get in here. If NZ needs highly skilled people where there is a skills shortage then those people applying for residency may be put off coming if they are not allowed to buy houses. Citizenship is automatically given to permanent residents who have been here for 5 years so there are few hoops you need to jump through that would make you more deserving of property ownership.

The multi property investor is not hit and these are the root of competition for new entrants in Auckland lower value areas.
But the potential price drop could release stock on to the market as a sideline to a land tax making some property less investor valuable.
A multi pronged attack is needed.........and quick.

There is an absolute Tsunami of money on its way out of China. Good luck stopping that. We will continue to swap real assets for pieces of paper because that is the Political 'modus operandi' in this country. This is 'Anything it takes Central Bank Economics' ..so grab a deckchair and enjoy .... full steam ahead!
http://creditbubblebulletin.blogspot.co.nz

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Of course Key's mates in China are none too happy by the capital flight from their shores. Anecdotal evidence suggests a large amount of this money is being laundered through lightly regulated real estate markets such as Auckland and Vancouver. Did Key just get the hard word during his recent trip that his "hands-off" approach is not pleasing his masters?

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Maybe Key shouldn't go to China any more. It gets complicated for the poor guy.
When he's here he gets political donations from the immigrants with possibly dirty money??? But when he goes to China he gets questions about extradition of such people. And hears of their reluctance to allow dirty money to flow to places like NZ.
So he has a dilemma now.

QUID-PRO-QUO
They asked 2 years ago, then
They asked again 1 year ago

Nothing done
So China tightens up its rules on importation of baby-formula
This time he went to China cap-in-hand to re-negotiate the FTA

and he got told QUID-PRO-QUO

Money talks
Read this at your leisure
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1162...

Number 5 on China's top 100 wanted list
He's been in NZ since 2001
4 Aliases
4 passports in those 4 aliases
On interpol's red-flag list
15 years later he's still here
No charges have ever been laid
His assets have been frozen
How did he get the money in?
Nobody has ever asked that question
Is it too late to do a forensic investigation to find out where the loop-holes are?
Is he being protected?

Money talks

...you missed a KEY point ...

"The following year, Liu - also known as William Yan, Yang Liu and Yong Ming Yan - moved to New Zealand and was later controversially granted citizenship, despite having multiple identities and an Interpol alert against his name".

And this was against official advice at the time

".......and why a former Cabinet minister disregarded the advice of officials and granted him New Zealand citizenship"

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1080...

So who made the call and why????

Dover Samuels wasn't it?
When Key discusses extradition, there is the convenient excuse that NZ won't allow an extradition treaty with China due to Chinas' death penalty. Very convenient.

and why has his citzenship not been revoked?

I assume we have an extradition treaty with the U.S.? They have the death penalty and also love to waterboard. So what the difference with China? When is someone going to ask him this?

@ rastus: Money made that call!!!

Well done JK, go ahead asap with the land tax on foreign buyers.
To all the smart commentators who ridicule our prime minister in this blog, why don't you become a successful businessman coming from a poor family, then give it up to go into politics, climb your way to the top and run the country for 9 years with a vast lead over the opposition.

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This is not ridicule.
This is advice that if he doesn't do something really soon about Ak property, there will be a large crisis in NZ. Banks will go bust. People will lose everything.
He has to do more. And soon.

Unfair comparison. The ladder has been pulled up considerably since then. You'd be lucky to get a state house in this day and age. Then you'd be hit by education costs. The job market has also significantly tightened for new graduates so landing that high paying job would be a lot harder. Property also unaffordable for many so prepare to spend what little income you start with on rent.

because the state will not pay for me to be housed and educated as they did for JK.
how quick we forget what we got and make sure those following us do not have the same advantages

Could you please name this so called business that was founded and run by Key?

Head of Global foreign exchange, Merrill Lynch. Folded in 2008, bought out by BoA.

Oh the irony! Lets hope that NZ doesn't fold, bought out by Asia. :P

How can this guy get resident ship in the first place, the immigration should have already done the criminal check in his application. If this guy use false paper work or information in his application, then JK government can easily remove his resident/citizen ship due to false information supplied. How hard this can be done?

Interestingly today we haven't seen any no discussion of who is actually going to wear this tax..
In general we are still not totally agreed on whether the issue is predominantly a demand side issue or a supply side issue.
Without this, what is the point in even mooting a tax..
In the current environment, the level of (perceivably low) elasticity and growth in demand vs supply would indicate that buyers would suggest that tenants would wear the majority of the imposed tax..

Don't worry though, not even JK or BE (unsurprisingly) seem to have a fixed position on the topic, either. NB Story last 2 weeks past citing no need for demand side measures..So, a complete U-Turn in the space of 2 weeks, post a China visit.

maybe the chinese supplied the data we are unable to collect?
they might know the scale and amount of money sent here and invested in our houses

Very funny!

Land tax, foreign 'rich' investors my God what a nightmare as all non residents have to redistribute, build trusts and create resident property companies to circumnavigate this ill thought out idea, huge win for the lawyers and accountants however! Land tax only works if applying to all property otherwise the rich (smart) will find a away around it, I can already hear my lawyer rubbing his hands waiting for my overseas Skype call

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Quite frankly I as a NZ citizen don't want any non residents being able to buy a god damn thing in this country! Not our land, our homes, our farms, our forests, and particularly our water.....ever!
We must be crazy even letting it get to this point! JK seems to think proof of an already too late runaway train is then the time to act. This shows a total disregard for the actual born and bred citizens and taxpayers of this country. A land tax alone is not good enough surely? Are we really this naive and stupid?
I want my country back but fear it's too late already.

Yes, Justice. naive and stupid....have been saying the same since I found this site.

Seems like forever...this problem in his, repeat his...making.

Turn-Key gets a country into problems, then have the audacity to say he will resolve it.....at long ,long,oh so bleedin long.... last.

Gives away everything he never, never, appreciated...when he was skimming and scamming overseas....hence why he does not appreciate, what all this means to residents who do not want it all spoiled, in the name of his god..Mamon.

Some Awklanders may have appreciated their Capital Gains, but some of us are not that greedy. But it is spreading...as we all know, even if Turn-Key is blind to the obvious.

Some of this sites main contributors want the train wreck to continue....for obvious reasons. I could name and shame them...but why bother, they have no shame.

Never done a days work in their lives and want others to pay them for the privilege of borrowing ...other peoples money, on the cheap. And leverage it up to infinity.

Cheap skates one and all....and it is a slippery slope....as some will find to their cost.

I hope, not all of us.

Building a future is not all about Houses...but it is what some pin their hopes on.

I will not mention the flag......fiasco....ever again.. Sufficient to say....it has its backers still....heading up the wrong path...too.

Well said. I think the pendulum is swinging and key is in for some pressure. He has always had a compliant media, has never known the hostility of years in opposition...... I reckon if the media swings he will be absolutely hopeless.

Alter ego, are you saying because I have never earned minimum wage that I should be ashamed of myself, I have a better idea, why don't we all live in state housing, earn 15 dollars an hour, and pray to our dear leader 10 times a day...this land tax idea will fizzle along with everybody else who stubbornly reject property investment as a viable way to privately ensure all residents of new Zealand have clean and warm housing close to their workplace

...born and bred citizens....I want my country back.....

Nativist and regionalist sentiments. How come you guys poo-pooed my suggestion of a Kiwi Identitarian youth movement? We voted to keep the flag because it represented our identity. Born and bred citizens should have special rights and the country is more than just real estate to be sold to the highest bidder. Sounds identitarian to me. Even immigrants want to adopt the Kiwi identity. Many voted to keep the flag because the flag represented the European civilization they wanted to be a part of.

"Born and bred citizens should have special rights and the country is more than just real estate to be sold to the highest bidder."

Not identitarian but humane and idealistic in the most positive sense. Destroying an entire people's home and soul is a cold genocidal thing to do.

Maybe you are one of the great misunderstood of our times - I find it hard to believe people would reject a message of obvious compassion.

Keywest,
All the signs are that the taxes on foreign investors are working in the Hong Kong, Singapore and London markets.

We need better disclosure on beneficial owners to accompany this land tax but it would be a big step in the right direction.

Quote: John Key said any such tax would apply to non-residents regardless of citizenship

Define non-resident

Isn't the owner of an investment property occupied by a tenant considered to be non-resident in that property? - I think so
Unless you are occupying it you are not resident in it

Further,

if you peel away Trusts and company cloaks and get to the ultimate owner(s) doesn't that mean the likes of Crafar Farms owned by Shanghai Pengxin are ultimately owned by an overseas (non-resident) corporation - oh dear - do you hear the screams?

I see exemptions popping up already

Defining non-residents for taxation purposes is a science in itself. It has to do with how many days per year you spend youtside NZ, where the "center of your life" is e.g. as defined by where your wife and kids are located etc.

Key, lacking commonsense and any concept of fairness, is of course coming up with a bureaucratic monster. Amazing idea to slap expat Kiwis with taxes when they are overseas and not using any NZ government services.

What is wrong with John Key that he views it as "discrimination" if he was to treat Kiwi expats better than any other foreigner?

The man is a traitor.

JK tweeted tonight that he spent the day in Mt Roskill with high school students telling them to 'have faith in NZ and to work hard to make it better'. There are so many things wrong with his tweet that all I could do was laugh. Like hysterically laugh. The replies were fantastic too. Where they gonna live when they are working hard for NZ? Caves? Omfg. Brilliant piece of comedy.
I know, I shouldn't. This is serious. Nevermind, I'm giving up Sky TV next week so she'll be right mate...

Good work man, you should have that deposit in 70 years!

The result of Key's ingenious plan would be that Kiwis working in AUS will have to pay "land tax" on the property they left behind, even if their relatives live in it or they are renting it out to fellow Kiwis, while the proverbial Korean or Chinese who works back "home", flies backwards and forwards to his wife and kids who sit in NZ pays NOTHING.

Obviously this is, because the Kiwi expats in AUS get nothing from NZ, while the Asian wife & kids get all the NZ government cuddles they deserve.

John Key is becoming a real problem. He has no idea what is going on, or - worse - he does and only rules for his Asian friends.

Australia (Victoria) charge 1.5%. I can't see Key wanting anything higher than that. So 1m dollar average home will get charged 15ka year. Probably won't make a huge difference however better than nothing.

Looking forward to seeing the data. Will be impacted by the new IRD requirements however least it's a step in the right direction.

Stamp duty charge on all investors (local and foreign) is also necessary. See investors make up 80% of FHBs in Otara and other lower priced suburbs. Isn't that crazy.

Australia (Victoria) charge 1.5%. I can't see Key wanting anything higher than that. So 1m dollar average home will get charged 15ka year. Probably won't make a huge difference however better than nothing.

Looking forward to seeing the data. Will be impacted by the new IRD requirements however least it's a step in the right direction.

Stamp duty charge on all investors (local and foreign) is also necessary. See investors make up 80% of FHBs in Otara and other lower priced suburbs. Isn't that crazy.

That is a long term problem when you have investors out buying FHB it will cost us all in the future in economic and social ways.
It's past time the playing field was tilted back, higher lvr for investors, no ability to claim interest, ring fence losses against the property not to applied to other income, GC tax on sale

That is a long term problem when you have investors out buying FHB it will cost us all in the future in economic and social ways.
It's past time the playing field was tilted back, higher lvr for investors, no ability to claim interest, ring fence losses against the property not to applied to other income, GC tax on sale

It's a flawed panic move. Lots of overseas investors buy through proxies who are NZ residents. They tend to be cash buyers. A tax on anyone's second or more investment properties is needed. Saw a tale in the NZH about a youngster with parents back in China who owned 11 Auckland homes. That's 11 young couples forced to be tenants in their homeland. i have seen tearful youngsters outbid at auctions by investors many times. The investors rake in tax-free gains, the youngsters become their tenants. Oh, brave new world....

Yes I'm sure when the finally let us see the 'adjusted IRD figures'. I very much doubt that they'll have filtered who purchased as a 'Resident' or a 'Citizen' to try to clarify what's been happening. So yes I think you're right it may be best to do a more blanket tax of CGT and possibly Stamp duty on Property Investors.