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Strong Interest in New Zealand Bloodstock at Karaka Sales

Strong Interest in New Zealand Bloodstock at Karaka Sales

Media Release

29/01/2015

This week’s Karaka bloodstock sales can expect to see a nice swing to top-end colts that will eventually make their mark in the stud market, says Geoff Roan, Bloodstock Client Manager for Crowe Horwath.

“In part this reflects the influences of the changes six years ago to the Income Tax Act, which accelerated write-downs on colts,” he said.

The market was also feeling the impact of the recent amendment to the Goods and Services Tax Act, allowing overseas entities to register for GST if they are registered in their own foreign territory and don’t have a taxable activity in New Zealand.

“It was designed to make New Zealand an easier country to do business in, and I have seen a number of Australian businesses registering as a result of this change,” he said.

“Hopefully this will also have an impact on investment into New Zealand bloodstock.”

There are around 1,400 yearlings worth approximately $70-80 million at this year’s Karaka sale, which runs from 28-30 January.

“We have recently see the likes of Ocean Park (NZ), Sacred Falls (NZ), Rock n Pop (NZ), Criterion (NZ) and Sham Express (NZ), all purchased out of Karaka yearling sales and now going to stud,” said Mr Roan.

“These colts are now valued from $5-to-$10 million and have the chance of becoming successful stallions.”

Mr Roan said the New Zealand domestic market has been showing signs of strength, but the high dollar could potentially dampen overseas investor interest.

The continued support from foreign investment into New Zealand is vital, so we need to ensure our taxation policies are current, equitable, easily understood but also structured to encourage investment into the sector. The industry is valuable to the New Zealand economy and we need to remain competitive in a tough global market.

ENDS

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