Crikey. National’s tax policy just dropped, and at first blush its strategy to fund its $14.6 billion tax package appears to hit all the sweet spots. Nicola Willis was calm, measured and across all the details during the hour-long press conference, where her leader Christopher Luxon laughed as she made some of her key points during her address, and hummed his fervent agreement throughout.

Here are the four new revenue streams National has outlined, (while promising there will not be a fiscal hole):

National would roll back the foreign buyers ban – which Labour put in place in 2018 – and apply a 15% tax for purchases on houses worth less than $2million (a National press release said more than $2m but this was incorrect).  Finance spokesperson Nicola Willis said this would generate $740 million a year.

Whether undoing the ban will have Kiwi’s competing with more foreign buyers in our over-cooked housing market, as Labour claims, is a key question National will have to contend with.

David Parker this month said fewer than 1% of houses nationwide were bought by foreign buyers as a result of Labour’s ban. However this only covers pre-existing homes (so they can still buy houses off the plans) and there is little evidence the ban helped cool down the housing market. Foreign buyers played a huge role in Auckland’s housing market, particularly. According to Parker, at the peak they made up 22.2% of sales in the three months ending June 2018 in central Auckland, and 9.7% in Queenstown in the three months ending March 2018. It was now down to under 1% nationally, he said.

National would end the commercial building depreciation tax break which would generate about $525m a year. Labour has already promised to do this in order to fund its policy to scrap goods and services tax off fresh and frozen fruit and vegetables, so it is happening either way. It was paused during the pandemic, giving commercial landlords a bit of relief, but that relief is now on its way out.

It would also introduce an online gambling tax for offshore operators – which seems like an easy win on first glance but may have a few fishhooks in it.

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Firstly, it is not clear how it will be enforced. Only the TAB and Lotto can legally advertise to New Zealanders, but people can gamble online for example with overseas-based casino websites and sports betting sites.

It is also an issue the Labour Government has in its sights. Minister for Racing Kieran McAnulty announce in May that the Cabinet had reached an agreement “in principle” to prevent New Zealanders from placing bets with online bookies overseas, but InternetNZ warned using technology to block people from visiting overseas gambling websites won’t be effective.

National would also make a user-pays immigration system. Nicola Willis was asked whether this would deter any of the migrants with skills New Zealand desperately needs – nurses, doctors and teachers – from moving here but said she didn’t believe it would because research shows fees are not a deciding factor. Undertanding the process and having a clear pathway were more important she said. Fees would include $375 for a student visa, $750 for employer work visa, $700 for apost-work visa, and $2750 for a partner residence visa. These were substantially cheaper – by more than half – when compared with Australia’s fees.

Our newsrooms are now working frantically, going through the policy line by line to understand how this policy will work, and how it will effect you and your family and will be reporting what we find live here on the blog.

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