Support for the policy intent underlying the community housing entity proposals

Clauses 28, 29, 110, 123 and 159

Submissions

(Accessible Properties, Community Housing Aotearoa, Ernst & Young, Marlborough Sustainable Housing Trust, New Zealand Institute of Chartered Accountants, Queenstown Lakes Community Housing Trust, Sue Barker)

The submissions support the policy intent of the amendments to confer a new income tax exemption for certain community housing entities and donee organisation status on these entities so that tax incentives can be claimed for donations to such entities.

However, the majority of these submitters (mainly from the community housing sector) were strongly opposed to the eligibility criteria and recommended significant changes. The sector’s opposition centres on the proposed income and assets tests that would be applied to the intended recipient class. (Accessible Properties, Community Housing Aotearoa, Marlborough Sustainable Housing Trust, Queenstown Lakes Community Housing Trust, Sue Barker)

Broadly the amendments will increase certainty in the tax system and align tax policy with the Government’s housing policy. (New Zealand Institute of Chartered Accountants)

Comment

The amendments are intended to address the current tax uncertainties relating to community housing entities who provide affordable home-ownership products to low-income households. These tax uncertainties arise because the charitable status for some of these entities is uncertain. Therefore, the amendments would be relevant only for those entities that lose their charitable status.

Specific concerns with the eligibility criteria are dealt with in the next items.

Recommendation

That the submissions be noted.