The majority of supporters (68%) supported the tax on foreign ownership of land proposal, so it has become 5PM policy.
PROPOSAL: Foreign entities and foreigners (individuals who are neither New Zealand citizens nor permanent residents) should be taxed 10% of the value of New Zealand property purchases – with the funds raised being offered as low interest loans to NZ resident first home buyers?
The principal legislation governing land purchases in New Zealand by overseas persons is the Overseas Investment Act 2005, where approval by the OIO is required for the acquisition of an interest (including a leasehold interest) in land referred to as ‘sensitive land’ including non-urban land that exceeds 5 ha in area; farmland; land located on specified islands; and land including or adjoining lakes, the foreshore and seabed, reserves, and historic areas. Other purchases require no approval.
Foreigners buying real estate should pay a premium for the use of New Zealand’s infrastructure. It is a flexible regime that can be used to mitigate the inflationary impact of foreigners buying New Zealand real estate. It is consistent with controls in overseas jurisdictions.
This is discriminatory taxation and as such it is inconsistent with most of New Zealand ‘s tax laws. Foreign buyers of real estate should be treated the same as New Zealand buyers. In other words, the law is not broken and doesn’t need to be fixed.
The total list of 5PM policy can be seen on the POLICIES page.