Dear John,
Petition to open the trans-Tasman
Bubble
I am overwhelmed by the wonderful response I have had from
people contacting me in support our National Opposition petition to
get a travel bubble opened between Australia and New Zealand as soon
as possible. By March 22, 2021 we had 42,000 signatures.
We need to help families to be reunited with their loved ones
either here or in Australia without the need for lengthy isolation at
either end.
Australia has been taking visitors from New Zealand for a few
months now with no reported sickness from Covid-19 or any other ill
effects. So surely we can do the same for Australians who want to
visit family and friends here?
For the sake of our Tourism Industry we need to open the
bubble to get Australian tourists back into places that are really
suffering like Queenstown, the West Coast and Rotorua. Our tourism
industry and our hospitality industry urgently need more visitors
following the terrible year that they have endured since our first
lockdown in 2020.
I am afraid that Australia will open a bubble with Singapore
before we can secure one and we might miss out on the Pacific Islands
bubble too, if the government doesn’t act quickly.
The Prime Minister has announced that there will be an
announcement on 6 April about the timeline for opening up our borders
to Australia. But that gives no clue as to what the tourism and
hospitality sectors can expect, so they cannot make plans to be ready
for the welcome return of business.
I will be continuing to press for answers as to why the trans
Tasman bubble is delayed especially as we now have the ability to
vaccinate people against Covid-19. Although it seems the programme has
slowed following the vaccination of frontline and border employees as
well as some medical staff. We need to be updated on the timeline, the
progress and systems for administering a New Zealand wide vaccination
programme.
Housing
This government certainly knows how to surprise us with the
completely different look of the policies that they are pushing
through now but didn’t give details of, before the Election in
2020.
In September last year the Minister of Finance Grant
Robertson categorically ruled out making changes to the Bright line
test to control the housing market.
The Prime Minister ruled out a Capital Gains Tax.
Now under urgency, starting from 27 March, the Brightline
test is going to double to ten years of ownership of a non -family
home before a sale can be made without capital gains tax being
payable.
The Government has also decided that Landlords will not be
able to offset mortgage payments against the income tax on the rent
they receive. For people who have borrowed significantly to buy a
house that they then rent out to those who can’t afford to buy, this
is going to be very expensive. If the rent goes up so does the tax and
the tax cannot be deducted against mortgage payments. Property
investors’ representative organisations are furious and call the moves
‘bizarre’ and ‘crazy”.
It is also extraordinary that the government is going to tax
gains made on sales of the main or family home if that home is rented
out for a period of more than a year and sold within 10 years of
purchase. This is definitely a Capital Gains Tax.
In an attempt to sweeten the deal, the Government is going to
put $3.8billion into the budget for infrastructure so that new housing
developments can go ahead because there will be water, sewage and
roads available to service them.
Whether this actually speeds up the production of houses for
people will still depend on the time it takes to get everything
consented by local government. Because once again the government has
not provided the details, the timelines or the targets.
It seems that luck will determine if you get a Kiwibuild
house and if you are not lucky, high rents will be inevitable as
landlords need to get a return on their investment.
The problem we have is the time it will take to get all of
this development going despite the government acting urgently. The
government’s legislation may bring the housing market to an “abrupt
stop” and cause a big drop in the value of houses but that doesn’t
mean greater supply or lower rents.
Many landlords, who are just ‘Mum and Dad’ investors, will be
really hit hard because their investment property has just become less
affordable for them because of its sudden lower value, as well as the
annual tax on income from it going up without mortgage payments being
deductible. There will be flow-on effects for tenants as well, like
higher rents and other consequences, which haven’t been identified,
but also for landlords the outlook is bleak.
Like some commentators, I think it will not change the
current housing market prices in the short term but it will stop
people selling existing houses pretty quickly and developers may have
second thoughts.
Kind regards,
Judith.
Hon Judith
Collins http://judithcollins.national.org.nz/
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