Is it not obvious Mr Key!? CHARGE A STAMP DUTY!

[Crookie]

STAMP DUTY!

The government charges stamp duty (a fee) on the sale of all investment properties and / or properties purchased by non residents / citizens.

The lawyers do all the work for this as the they would charge this as part of the settlement figures and deposit loads of money into the governments account! Requires no policing, easy to monitor and you could set different percentage rates depending on the value of the property and / or number or properties purchased.

If this was kept simply for overseas investors surely this would be a popular move with everyone (especially the voters!!!)
Think of what the government could do with the money- low lost loans to first home buyers, help the council with infrastructure / release of land,

what's the downside...............?

[Anthonyacat]

If a stamp duty were applied only to overseas investors this calls up all sorts of potential problems. Not saying it's not a good move, but there are certainly downsides. I know that China's free trade agreement prevents them being treated any worse than any other country, so we wouldn't be able to exempt Australia from such a tax. I believe Australia gives NZ some exemptions from its foreign buying laws, so that'd cause tension.

In general though, a stamp duty certainly has downsides. Ignoring the whole 'ANOTHER tax???' and potential spreading issues, there is the problem of restricting the market. If you're going to be penalised every time you move house, you're going to hold off from moving as much as possible. Leads to inefficient living arrangements, and makes the property market (and sharemarket, which would certainly eventually be incorporated) overall less liquid and less efficient, which emphasises booms and busts.


After all of that, I do in general agree with a stamp duty, and in fact an overall financial transactions tax. If set on an incredibly broad base, it could be created at a very low rate and still support the entire government, without the need for Income Tax, GST, FBT, and so on...

But this would involve an entire destruction and recreation of our tax system. And I don't see that happening. Any stamp duty will be in addition to current taxes, and that's something I'm opposed to.

[eri]

build more houses

don't talk about It

JUST DO IT

[Glenn]

Paying another tax is just like handing your money over to the Mafia. All sorts of promises are made such as "We promise you will not have an accident".
But they always come back the next day and ask for more.
The Government keeps upping the money they hand out to IRD for collecting from property investors. Twice now the IRD have "asked" to come and speak at Nelson Property investors Association meetings. These meetings cost us over $500 every time to put on but each time despite me asking they will not contribute towards the cost. People or organizations that "request" for service and will not pay are no better than any other debtor out there. Just low life scum. The same as tenants who do not pay me. Debtors like this are dishonorable and can not be trusted. Their bosses who send them out onto the streets of our cities to coerce and threaten us are no better than the Mafia bosses.
As for the foreigner's tax they have started to collect information on. Watch this space. The next thing we will see is everyone that has black skin will pay an increased fee if they wish to buy properties.

[eri]

now now Glenn

everyone knows you're not allowed to discriminate based on skin colour

only nationality

[Davo36]

Paying another tax is just like handing your money over to the Mafia. All sorts of promises are made such as "We promise you will not have an accident".
But they always come back the next day and ask for more.

Hear hear.

build more houses

don't talk about It

JUST DO IT

Now settle down young fella. Firstly plans have to be drawn up for land subdivision. And hefty fees paid. Then plans for each house have to be drawn up and lots more hefty fees paid. Then, and only then, can building begin, only to be stopped at regular intervals for 'inspections' where more fees are paid, then, when it's all finished, and the final lot of fees paid, a certificate is issued. That's the proper way to do things. Nice and slowly, and all union-like. You'll learn eventually.

[Stevegoodey]

I agree davo36, and ponder this if the market is about supply and demand and house prices have moved to their current point without developers being able to afford to start large scale supply, then imagine how hard and expensive it is to do.

I wonder how higher prices have to be before it makes financial sence for developers to build large scale.

[Glenn]

now now Glenn

everyone knows you're not allowed to discriminate based on skin colour

only nationality

Well my father was born in Australia.
Does that make me a foreigner. I certainly have the same skin colour and eyes as him. Does that make me a foreigner.
I have a Japanese sister in law and and Indian nephew. Does that make me a foreigner.
I have visited multiple overseas countries over the last 12 months and purchased a bit of foreign currency. Sorry but I own no property overseas. Does this make me a foreigner.
My daughter lives in Uk and is classed as a non resident tax payer. Does this make me a foreigner.

No nothing of the kind. The only thing that makes me undesirable in the eyes of the Government is I house people who can not afford to buy a house of their own.
I am able to do that because I have worked for 50 years and not spent my earnings on life's pleasures. I have gone without and felt once or twice hungry.

[elguapo]

Now settle down young fella. Firstly plans have to be drawn up for land subdivision. And hefty fees paid. Then plans for each house have to be drawn up and lots more hefty fees paid. Then, and only then, can building begin, only to be stopped at regular intervals for 'inspections' where more fees are paid, then, when it's all finished, and the final lot of fees paid, a certificate is issued. That's the proper way to do things. Nice and slowly, and all union-like. You'll learn eventually.

Plans? You can't just start off with plans! You must start with reports, many reports by important consultants, then you can move to consultation and given the impact of this radical idea of building houses for people to live in, that consultation must mean more reports and so on. Plans don't come until decades of reports and consultations.

[eri]

^

and you'd better be sweet with all your neighbors

because if they object

everything will probably grind to a halt while their concerns are addressed

and if they're still not happy

they'll probably tell the media

1 of the 80yo trees there is actually 500yo

at which point an iwi will be brought in

to see if work can be made even slower and more expensive

[andyp2010]

Stamp Duty - Doesn't work in London and it's levied on everyone, not just overseas buyers

[Anthonyacat]

A bit far to say it "doesn't work in London". That depends entirely what you think the aim of the tax is.

It certainly hasn't kept the market here at affordable levels, but who knows how much higher it might be if there were no stamp duty?

But who says that is the purpose of the tax anyway? Is the purpose of income taxes to keep people's wages low? Did they implement GST to discourage people from buying things?

Taxes raise money for the government, and I'd argue on that basis it's working incredibly well in London.

[andyp2010]

For the purpose of deterring overseas investors it doesn't work

[Anthonyacat]

But that's not the purpose, don't think anyone ever said it was?

Certainly not in London, where the tax is paid by all investors. In fact, there are (or were, think they're changing at present) methods where overseas investors pay LESS stamp duty than UK residents.

[Crookie]

But who says that is the purpose of the tax anyway? Is the purpose of income taxes to keep people's wages low? Did they implement GST to discourage people from buying things?

Taxes raise money for the government, and I'd argue on that basis it's working incredibly well in London.

I agree, this raises money for the government who, in turn, could set about providing Auckland with a decent public transport system to help the people who actually live here and pay into the tax system through their income tax actually get to work on time!
It's all good saying build build build but where are these houses going - oh yeah, that's right, on the outskirts of auckland where the council need money to develop infrastructure and services. If it doesn't come from ideas like this- it'll come through other taxes (like our rates!!!!)