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Nicola Willis: Finance Minister addresses concerns over India FTA · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks B follow
• 0:12
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  Speaker 2: Of course with us as Nikola Willis the Finance Minister
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  Speaker 2: High Nicholer. Hi, Ever, are you guys considering a storm
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  Speaker 2: damage tax?
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  Speaker 3: No, we're not so.
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  Speaker 2: Matthew Houton writing that a storm damage tax has been
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  Speaker 2: temporarily put on hold is what.
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  Speaker 3: He's very confused. So what we have is the Natural
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  Speaker 3: Hazards Commission. You'll be aware that's the old EQC and
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  Speaker 3: Home and Contents insurers. At the moment, when you pay
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  Speaker 3: for your home and contents insurance, there's a small levy.
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  Speaker 3: So the Natural Hazards Commission. Our government actually made the
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  Speaker 3: decision to pause a plan to increase that levee by
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  Speaker 3: a couple one hundred dollars a year while we were
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  Speaker 3: looking at what's happening with insurance affordability and uptake. So
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  Speaker 3: no plan to introduce a new weather tax.
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  Speaker 2: So the weather tax would be what that tax when
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  Speaker 2: it's final brought back in.
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  Speaker 3: Look, you'd have to ask you, Matthew what he's talking about.
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  Speaker 3: Everyone at the moment, and they have for several years,
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  Speaker 3: pays a small levy to the government when they take
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  Speaker 3: out home and contents insurance and that's there to cover
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  Speaker 3: hazardous damage to your land in your house.
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  Speaker 2: Okay, the taxes that major banks play pay, you're having
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  Speaker 2: a look at that. Are you planning on doing something
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  Speaker 2: in this space?
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  Speaker 3: Well, what I have been doing, of course, is looking
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  Speaker 3: at the general rules that apply to our major Australian
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  Speaker 3: banks to make sure that the rules are all fair.
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  Speaker 3: One of the areas that ID are currently consulting with
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  Speaker 3: the major banks on is how they account for their
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  Speaker 3: profits in New Zealand versus offshore and therefore what tax
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  Speaker 3: implications that has. It's called branch sharing arrangements. They're in
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  Speaker 3: consultation with them to understand whether we're doing that fairly
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  Speaker 3: or not. And that's just basically what you do to
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  Speaker 3: have good tax law. You make sure that the way
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  Speaker 3: the tax law is working is that it's working is intended,
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  Speaker 3: that it's fair, that people aren't avoiding it in ways
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  Speaker 3: that weren't presumed they would when the rules we wouldn't place.
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  Speaker 2: Okay, but there is the possibility of adding a levee here,
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  Speaker 2: isn't there?
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  Speaker 3: Well, we have this year, of course added the deposit
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  Speaker 3: compensation scheme levy, which I mean essentially means that all
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  Speaker 3: New Zealanders know that up to ten thousand dollars of
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  Speaker 3: your sailings will be covered in the event of a
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  Speaker 3: major bank failure, and everyone's paying a levee for that.
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  Speaker 3: That was something initiated by the last government that we
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  Speaker 3: think is good policy, and we're continuing.
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  Speaker 2: No further levies on banks.
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  Speaker 3: Well, as you can see by the discussion that I'm having,
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  Speaker 3: the way that we tax banks is something that I
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  Speaker 3: think should be always under a view, always looking at
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  Speaker 3: to make sure that it's fair. But bottom line, for me,
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  Speaker 3: I want it to be fair on you, the user
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  Speaker 3: of banking services. I don't want it to be something
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  Speaker 3: that imposes an extra cost on you.
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  Speaker 2: So it is possible that there will be a bank levy.
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  Speaker 3: Well, there already are bank levees. Let banks pay levees
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  Speaker 3: to the Financial Markets Authority, they pay levs on the
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  Speaker 3: deposit compensation scheme, and of course they pay tax on
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  Speaker 3: the profits that they make. And as I said, I
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  Speaker 3: have been seeking advice on is all of that looking tidy?
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  Speaker 3: Is it all looking fair?
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  Speaker 2: Just rule it in all out right, It's possible if
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  Speaker 2: you don't rule it because but you know, we play
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  Speaker 2: this game. But then if you don't rule it out,
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  Speaker 2: then it means I go Bank's Levy tick, she's considering it.
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  Speaker 3: If I go into the budget ruling things in and out,
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  Speaker 3: what quickly happens and we went through this together.
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  Speaker 2: This might pop up in the budget.
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  Speaker 3: You say, you say, oh, well, she ruled that out,
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  Speaker 3: but then she won't rule that out, so that means
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  Speaker 3: that that is happening, and it just becomes a deductive
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  Speaker 3: thing ahead of the budget. I just go into not
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  Speaker 3: ruling out, not ruling out, just acknowledging a range of things.
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  Speaker 2: Are you aware that on another tax, which is the
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  Speaker 2: border tax, freightways has a problem and they would like
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  Speaker 2: a level playing field.
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  Speaker 3: I'm aware of this, and I just want your readers
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  Speaker 3: to understand your listeners to understand what this is about,
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  Speaker 3: which is lots of people post COVID started buying things
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  Speaker 3: from Shine and Timu and online. The challenge with that
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  Speaker 3: is is it costs you, the general tax payer, a
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  Speaker 3: lot of money at the border. But by the time
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  Speaker 3: customs have done their thing, the border protection people have
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  Speaker 3: done their thing, and it created a massive cost to
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  Speaker 3: the taxpayer and The principle that Casey Costello, the Minister,
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  Speaker 3: has applied is actually the costs of all of that
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  Speaker 3: should be borne by the person buying the goods. So
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  Speaker 3: we should charge the career company's a price that reflects
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  Speaker 3: how much it actually costs to get those goods, and
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  Speaker 3: through this it.
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  Speaker 2: Looks pretty fair. That is a perfectly good explanation for it.
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  Speaker 2: But here's the thing. There's always a good explanation for
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  Speaker 2: another tax. But we've just talked about three taxes that
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  Speaker 2: you're considering. That's a lot of tax for a government
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  Speaker 2: that was not supposed to bring in any new taxes.
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  Speaker 3: Hey, hey, that first one we considered is one where
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  Speaker 3: I rejected the advice of officials to increase the levee.
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  Speaker 2: I wasn't counting that. That's the fourth one. We're just
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  Speaker 2: talking about the three you are doing. So you're talking
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  Speaker 2: about or a tax, gas tax.
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  Speaker 3: Well, well, I think every government has two things that
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  Speaker 3: should do. The first is minimize the new things that
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  Speaker 3: you do that will create costs for people. The second
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  Speaker 3: thing is you should ask who should pay that cost.
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  Speaker 3: Should it be you, the general tax payer from your wages,
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  Speaker 3: or is this something that should be paid by the
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  Speaker 3: people who are actually benefit.
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  Speaker 2: Which I love if when you put up the tax
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  Speaker 2: on the people the user pays, you reduce my taxes.
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  Speaker 3: But you don't, well, I think we need to come
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  Speaker 3: at it this way, which is before you put any
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  Speaker 3: user pays on or increase the user pays, first ask
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  Speaker 3: yourself the question does this really need to be done?
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  Speaker 3: And is it being done as efficiently as possible? And
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  Speaker 3: those are two questions our government always asks and we're
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  Speaker 3: very clear about that.
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  Speaker 2: Now, Chippy and the Labor Party are stirring trouble as
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  Speaker 2: you well know about the India FTA, So what can
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  Speaker 2: you tell us about this business that if we don't
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  Speaker 2: put the private investment into India within the next fifteen years,
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  Speaker 2: they may well pull market access.
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  Speaker 3: Well, look, what I understand from Minister maclay is that
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  Speaker 3: there is a really strong aspiration in the Free Trade
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  Speaker 3: Agreement to promote in investment, but it doesn't guarantee a
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  Speaker 3: specific amount of money, and that that's not what the
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  Speaker 3: agreement is saying. What it's saying is let's both agree
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  Speaker 3: to promote significant levels of investment in our respective countries.
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  Speaker 3: Let's put some aspirational targets out there. But it doesn't
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  Speaker 3: seek to hold governments accountable for ensuring that bottom line.
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  Speaker 2: Okay, So when Chippy says that the Indian government is
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  Speaker 2: telling its people that if we don't invest adequately, they
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  Speaker 2: will pull market access and that's in the agreement, he's
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  Speaker 2: talking rubbish.
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  Speaker 3: Well, you'd have to ask Chris Hopkins about that.
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  Speaker 2: I have to ask you because you guys have actually
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  Speaker 2: seen the documents.
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  Speaker 3: Well, and I'm telling you specifically that the documents do
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  Speaker 3: not guarantee a specific amount of money. They have an
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  Speaker 3: obligation that we promote a certain level of investment, and
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  Speaker 3: of course there's a difference between those two.
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  Speaker 2: Thanks. Now, listen, what did you make of the Milford
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  Speaker 2: boss saying that the superage needs to go to seventy
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  Speaker 2: two or seventy three?
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  Speaker 3: Quick?
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  Speaker 2: Smart, Well, I.
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  Speaker 3: Thought that was a bit over the top. To be honest,
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  Speaker 3: I do, as we've discussed before, I think there is
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  Speaker 3: a discussion about how we ensure universal superannuation is sustainable
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  Speaker 3: into the future. I do think there's a proper conversation
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  Speaker 3: about the growing role for key we Saver. National has
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  Speaker 3: promoted in the past gradually increasing the superage by up
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  Speaker 3: to a couple of years. But I haven't heard anyone
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  Speaker 3: suggest seventy three anytime other than Milford.
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  Speaker 2: Nikola, thanks very much, as always, appreciate your time on
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  Speaker 2: a Monday. That's Nikola Willis, Finance Minister.
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