NZIER was commissioned by a group of interested parties to make a submission to the Finance and Expenditure Committee on proposed amendments to the Foreign Investment Fund (FIF) rules in a Bill that is currently before Parliament.
This is our third piece of work on this topic, building on our earlier NZIER reports, which can be found here and here.
The latest submission highlights differences between NZIER’s earlier recommendations and the approach the government has taken in the Bill.
We also recommend further reforms to better support people who live, work and invest in New Zealand, particularly those building or funding innovative high-growth firms, by removing barriers that limit their ability to create and expand global ventures from here.
We do not recommend wholesale repeal or narrowing of the FIF regime. Given limited constraints on the free movement of capital and New Zealand’s desire to operate a progressive income tax system, the FIF regime plays an important role in preventing the tax-driven exodus of capital.