Latest / Best of Business / Bruce Bernacchi: Dentons tax partner says Green's tax will send investments overseas

Transcript

Bruce Bernacchi: Dentons tax partner says Green's tax will send investments overseas · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from Newstalk zed B. Follow
• 0:12
  Speaker 1: this and our wide range of podcasts now on iHeartRadio.
• 0:16
  Speaker 2: Now along with than Nats who have some ideas on
• 0:18
  Speaker 2: super savings, which we will look at shortly. We got
• 0:20
  Speaker 2: the Greens who were back with a vision of retribution
• 0:22
  Speaker 2: against success. They dream of raising thirty two billion a
• 0:25
  Speaker 2: new revenue. To do this, they will have a two
• 0:27
  Speaker 2: and a half percent wealth tax, of thirty three percent
• 0:29
  Speaker 2: inheritance tax, and a bump in the corporate rate to
• 0:31
  Speaker 2: thirty three percent as well. Bruce Binanki is a tax
• 0:33
  Speaker 2: partner at Denton's and is with us. Bruce, very good
• 0:35
  Speaker 2: morning to you, Good morning night. Even if they got
• 0:38
  Speaker 2: into power and enacted this, is it mathematically doable or
• 0:43
  Speaker 2: would people flee?
• 0:45
  Speaker 3: Well, look, Mike, I think not only would people flee,
• 0:48
  Speaker 3: we'd never get a lot of the wealthy migrants who
• 0:51
  Speaker 3: are moving here coming here in the first place. So
• 0:53
  Speaker 3: with this active investor plus visa program that we launched
• 0:56
  Speaker 3: in April last year, it's been phenomenally successful. We've had
• 0:59
  Speaker 3: over seven hundred applicants four billion dollars of new capital
• 1:03
  Speaker 3: committed to New Zealand. We advise a lot of these people,
• 1:06
  Speaker 3: and quite frankly, they simply would not come. And they
• 1:09
  Speaker 3: bring you know, they bring businesses, they bring connections, they
• 1:12
  Speaker 3: spend here, they pay GST, they pay tax here. And
• 1:15
  Speaker 3: so not only do you have these people not come,
• 1:18
  Speaker 3: then you get wealthy New Zealanders leaving. And most countries
• 1:21
  Speaker 3: that have implemented a wealth tax over the past twenty
• 1:23
  Speaker 3: thirty years have abandoned them for that very reason. You've
• 1:26
  Speaker 3: only got four countries from the OECD left trying to
• 1:29
  Speaker 3: impose this sort of tax.
• 1:30
  Speaker 2: So you can mount a tangible, numerically backed argument that
• 1:35
  Speaker 2: says at a certain level, people simply will not pay
• 1:38
  Speaker 2: what you think they will.
• 1:41
  Speaker 3: Yeah, exactly. And the thing with wealthy people is they
• 1:45
  Speaker 3: are extremely mobile. When you're that wealthy, you can live
• 1:48
  Speaker 3: pretty much anywhere you want. And the experience of a
• 1:51
  Speaker 3: lot of European countries was exactly that they had their
• 1:53
  Speaker 3: people leave and so they abandoned the tax. So this
• 1:56
  Speaker 3: will be a giantly backwards for our economy, which is
• 1:59
  Speaker 3: doing really well and attracting the sort of people we
• 2:01
  Speaker 3: want to get here who are going to bring business
• 2:03
  Speaker 3: connections and help make up some of the tax deficit
• 2:07
  Speaker 3: we have at the.
• 2:07
  Speaker 2: Moment, what would your interpretation of the thirty three percent
• 2:10
  Speaker 2: corporate tax rate be given you know, we wouldn't be
• 2:13
  Speaker 2: competitive anymore, would we.
• 2:14
  Speaker 3: Oh, look, I'll be a debacle. And then at twenty
• 2:17
  Speaker 3: eight percent, we're already at the high end of the
• 2:19
  Speaker 3: OECD in terms of the level of our corporate tax rate.
• 2:23
  Speaker 3: If you slap thirty three percent on that, it's just
• 2:25
  Speaker 3: going to be sending a message to the global community
• 2:27
  Speaker 3: that New Zealand does not open for business, We don't
• 2:29
  Speaker 3: want corporates here. And of course those companies are just
• 2:31
  Speaker 3: going to pay pass that cost on to consumers, so
• 2:33
  Speaker 3: you and iile end up paying one way or another.
• 2:35
  Speaker 2: Yeah, wealth tax? Does anyone do it successfully? Just to
• 2:38
  Speaker 2: straight up and down wealth tax?
• 2:40
  Speaker 3: Some countries that have a very low tax rates, like Switzerland,
• 2:46
  Speaker 3: it seems to successfully impose one, but they have very
• 2:48
  Speaker 3: low taxes to start with. And then other places like Norway,
• 2:53
  Speaker 3: they've been losing people, so that's their system's looking a
• 2:55
  Speaker 3: little bit while. But of course their economy is backed
• 2:58
  Speaker 3: up by a multi trillion dollar sovereign wealth fund that
• 3:00
  Speaker 3: helps pay for it for a lot of services in
• 3:02
  Speaker 3: the country, makes it a pretty nice place. To eleven
• 3:04
  Speaker 3: when you're not able to drill for offshore oil in
• 3:07
  Speaker 3: this country, when I'm never going to have one of those.
• 3:09
  Speaker 2: I think you've argued very o cohesively. Bruce, appreciate your
• 3:12
  Speaker 2: time very much, Bruce Banenki, who's the text partner at Denton's.
• 3:15
  Speaker 2: The other side of this is, and I've got to
• 3:17
  Speaker 2: formulate some sort of sort of policy, ongoing policy for
• 3:20
  Speaker 2: this election campaign. How much time do we want to
• 3:23
  Speaker 2: spend on things? Nothing wrong with the contest of ideas,
• 3:25
  Speaker 2: that's what elections are all about. But there are certain
• 3:28
  Speaker 2: ideas that are simply you know, for a fact, because
• 3:31
  Speaker 2: the major party in this case, the Labor Party, have
• 3:32
  Speaker 2: ruled this stuff out, it will never see the light
• 3:35
  Speaker 2: of day. The Greens are entitled to argue whatever they want,
• 3:39
  Speaker 2: but given it literally isn't going to happen, we surely
• 3:43
  Speaker 2: need to ask the question at some point, you know,
• 3:45
  Speaker 2: how much time do we want to spend on that
• 3:47
  Speaker 2: sort of nonsense.
• 3:48
  Speaker 1: For more from News Talks b listen live on air
• 3:51
  Speaker 1: or online and keep our shows with you wherever you
• 3:54
  Speaker 1: go with our podcasts on iHeartRadio