Goldsmith Update - July 2015

Goldsmith Update
Thursday, July 2, 2015

Governments do many things, but the most useful thing they can do is provide strong, stable, predictable leadership. When that exists for a few years, such as it has in New Zealand since 2008, confidence builds.  It’s confidence that leads to investment, and it’s investment that leads to jobs and growth.

The surprising thing is how rare that combination is, when we look around the world. Greece today is an object lesson in the consequences of instability, unpredictability and unsustainable finances. I hope, for the sake of the people of Greece, that their leaders find a path through their current difficulties to lay a platform for future growth.

In our Parliament we are in the third week of the current session. Perhaps of most relevance to the people of Epsom, where property prices cause excitement and nervousness in equal measure, was the first reading last week of a Bill to help Inland Revenue enforce the tax rules around property. It includes two measures to take effect on 1 October to help ensure everyone – whether New Zealanders or from overseas – pays their fair share of tax on property gains.

Buyers and sellers of property will have to provide their IRD numbers at the time of property transfer. There will be an exemption for New Zealand residents’ main home.

And to ensure our anti-money laundering rules apply, we’ll require overseas people to have a New Zealand bank account to get an IRD number.

We’re also putting in place a ‘bright line’ test on 1 October. Under this new test, gains from residential property sold within two years of purchase will be taxed, unless the property is the seller’s main home, inherited from a deceased’s estate, or transferred as part of a relationship property settlement.

These tighter tax rules are expected to take some heat out of the Auckland housing market by ensuring speculators are taxed according to the rules. 

They are part of a much wider effort to address housing affordability in Auckland, primarily by working to increase the supply of houses.

I was thrilled to see that the people of Epsom will benefit from the significant investment in urban cycleways, announced last week by Hon Simon Bridges. New routes will sweep into town across Hobson Bay, alongside the railway track, and through Newmarket and Parnell.  These will make cycling a safer, more attractive transport choice, especially for the many thousands of university students who live in the area. On the weekend I got my bike out and checked out some of the more recent cycleway extensions.

In the Commerce and Consumer Affairs space we have kicked off a review of the Financial Advisors Act and Financial Service Providers Act. The goal is to make sure that the laws regarding financial advisers are working as well as possible and don’t add complexity and compliance costs where they aren’t necessary. Better laws and regulations for our financial markets ultimately lead to increased consumer confidence, and better financial advice for people who need it.

Finally, as a List MP I don’t get invited to cut too many ribbons, so it was an honour last week to open the new café at Cornwall Park on a chilly morning. ‘Vision’ is a word we hear bandied around frequently, but there are few better examples than Sir John Logan Campbell’s foresight to hold together a great estate around the volcanic cone of One Tree Hill and bequeath it to the people of New Zealand, with an endowment to maintain without further cost to ratepayers. The current trustees, who give their time generously, carry on that legacy well.

Hon Paul Goldsmith
National List MP based in Epsom

P: (09) 524 4930