ANZO Points To Investor Concerns On Proposed NZ Property Taxes
Monday, February 8, 2010
The management board of AMP NZ Office Trust (ANZO), New Zealand’s largest
listed investor in prime commercial office property, while announcing its interim
results, has expressed concerns about the impact of two of recommendations included
in the recent report by New Zealand’s Tax Working Group.
Chairman Craig Stobo said that the proposed removal
of building depreciation and the introduction of a land tax, if adopted, will
have a negative impact on the near-term stability of earnings and investor distributions
for ANZO and other listed and unlisted commercial property entities.
“Listed property is an investment which is particularly popular with
older investors, who are already finding it tough in this economic environment
and depend on regular income from their investments,” he said.
Meanwhile, ANZO stated, there is also a potential impact on businesses from
the proposed land tax, as the most likely outcome is that this will be passed
through to building occupiers as permitted by the majority of lease contracts.
“The burden of these proposed taxes is therefore going to be borne by
investors who have taken steps to provide for their future, and the businesses
which are providing jobs for the current generation of workers – neither
of which have much ability to absorb new costs in the current economic environment,” Stobo added.
He concluded that: “New Zealand’s relative competitive position
on the global stage and ability to attract capital from overseas investors will
also be diminished by any new taxes that are imposed.”