Property Council supports lower regulatory barriers

16.2.2011

Property Council New Zealand supports lower regulatory barriers for trans-Tasman investment, but it says more work is needed on the Single Economic Market agenda, particularly around tax and regulatory compliance matters.

Property Council Chief Executive Connal Townsend said the New Zealand and Australian Prime Ministers’ commitment to more effort around trans-Tasman economic integration was welcome.

“The Closer Economic Relations Investment Protocol will encourage more investment by New Zealand’s single largest source of direct foreign investment – Australia.

“Property Council New Zealand believes this will help to stimulate our economy by giving New Zealand firms more access to capital, particularly in our biggest cities where the majority of our built environment is located.”

Once in effect, the Protocol will allow Australian investors in ‘significant business assets’ to inject up to NZ$477 million in New Zealand without bring screened.

Mr Townsend said ‘significant business assets’ showed the Government recognised a distinction between sensitive land or fishing quota, (categories under which investors will face the same rules as everyone else) and non-land investments including shares, plant and equipment involving 25 per cent or more ownership in business assets worth NZ$100m or more.

But Mr Townsend said while New Zealand investors would benefit from increased trade and a great alignment of investment rules, both countries needed to learn from each other’s treatment of individual investors.

“New Zealand investors benefit from the lack of stamp duties, no capital gains tax, lower marginal income tax and the move to a lower rate of company tax. But we are at a disadvantage with Australia, particularly in relation to depreciation, which is acknowledged across the Tasman but effectively denied here.”

ENDS

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