1 00:00:00,120 --> 00:00:03,200 Speaker 1: You study this morning claims we've got an outdated tax 2 00:00:03,279 --> 00:00:06,280 Speaker 1: system that could be scaring off xpaxwanti to come home. 3 00:00:06,480 --> 00:00:09,000 Speaker 1: It's too difficult for highly skilled workers to enter New Zealand. 4 00:00:09,360 --> 00:00:12,520 Speaker 1: Reports called the place where talent doesn't want to live. 5 00:00:13,720 --> 00:00:16,720 Speaker 1: Managing director of Viewers based venture capital firm Shaster, Rob 6 00:00:16,840 --> 00:00:20,400 Speaker 1: Connyebear's with us, Rob morning, Good morning mate, car Are 7 00:00:20,400 --> 00:00:22,840 Speaker 1: you very well? So the Insidie has done it, supported 8 00:00:22,840 --> 00:00:25,239 Speaker 1: by the Auckland Chamber of Commerce, the American Chamber of Commerce, 9 00:00:25,280 --> 00:00:28,040 Speaker 1: the inzed US Council, the edmun Hillary Fellowship. So this 10 00:00:28,120 --> 00:00:31,240 Speaker 1: is something that's widely known and accepted in the business community. 11 00:00:31,280 --> 00:00:33,520 Speaker 1: Is that fair Well, I would. 12 00:00:33,240 --> 00:00:37,440 Speaker 2: Say among the returning Kiwi xpac community, the talented people 13 00:00:37,520 --> 00:00:40,479 Speaker 2: that can help build technology startups. This is something that 14 00:00:40,520 --> 00:00:42,920 Speaker 2: people are very aware of and has had an impact 15 00:00:42,960 --> 00:00:43,480 Speaker 2: over time. 16 00:00:43,680 --> 00:00:46,760 Speaker 1: What you read, is it inadvertent or is it deliberate 17 00:00:47,000 --> 00:00:48,280 Speaker 1: by way of tax policy? 18 00:00:48,960 --> 00:00:52,760 Speaker 2: Well, I think this is something that is inadvertent because 19 00:00:53,159 --> 00:00:55,760 Speaker 2: one of the authors of this study, Peter Wilson, was 20 00:00:55,840 --> 00:00:58,760 Speaker 2: in Treasury when it was originally implemented, and it was 21 00:00:58,960 --> 00:01:02,240 Speaker 2: implemented for a completely different purpose than today, and that's 22 00:01:02,280 --> 00:01:05,520 Speaker 2: what's outlined and talked about in the report. So I 23 00:01:05,520 --> 00:01:08,600 Speaker 2: think it's something that is very fixable with awareness. 24 00:01:08,720 --> 00:01:10,280 Speaker 1: Right now, are we an outlile? 25 00:01:12,319 --> 00:01:14,560 Speaker 2: It turns out that New Zealand is an outlier with 26 00:01:14,640 --> 00:01:17,080 Speaker 2: this specific tax. Are you familiar with the tax? 27 00:01:17,200 --> 00:01:21,319 Speaker 1: Yeah? Actually, do it? Do explain it. It's investment and stuff. 28 00:01:21,319 --> 00:01:23,840 Speaker 1: It's in pipe, it's stuff that might not be making 29 00:01:23,840 --> 00:01:26,040 Speaker 1: any money. It's stuff that you envistment in obaseas they 30 00:01:26,040 --> 00:01:27,800 Speaker 1: text to you. Yeah. 31 00:01:27,800 --> 00:01:31,720 Speaker 2: I mean the basic issue is if you have if 32 00:01:31,760 --> 00:01:33,640 Speaker 2: you're a tax fair in New Zealand and you have 33 00:01:33,720 --> 00:01:37,440 Speaker 2: assets overseas, your tax on an annual basis, and it 34 00:01:37,480 --> 00:01:40,720 Speaker 2: doesn't matter whether those are liquid or illiquid assets. So 35 00:01:41,240 --> 00:01:44,840 Speaker 2: if you're trying to bring back entrepreneurs returning Kiwi's first 36 00:01:44,880 --> 00:01:48,720 Speaker 2: time migrants, often they have had a successful startup and 37 00:01:48,760 --> 00:01:51,680 Speaker 2: they have paper games, they have some sort of valuation 38 00:01:51,800 --> 00:01:54,680 Speaker 2: in that company and they can't you know, if it's 39 00:01:54,680 --> 00:01:56,800 Speaker 2: a paper game, you can't eat it, you can't use it, 40 00:01:57,200 --> 00:02:00,000 Speaker 2: But it doesn't matter. You still owe tax every year 41 00:02:00,080 --> 00:02:01,880 Speaker 2: ye're on it in New Zealand, and that can be 42 00:02:01,920 --> 00:02:06,640 Speaker 2: quite significant for the most i'd say successful entrepreneurs and 43 00:02:06,680 --> 00:02:10,200 Speaker 2: the most important part about this is these paper gains 44 00:02:10,360 --> 00:02:13,240 Speaker 2: maybe in companies that are ultimately worthless, but you would 45 00:02:13,240 --> 00:02:15,320 Speaker 2: never get that tax that's paid back. 46 00:02:15,440 --> 00:02:19,200 Speaker 1: No, exactly. So here's the good news. Potentially, this is 47 00:02:19,240 --> 00:02:21,679 Speaker 1: a government that would argue they want people, they need 48 00:02:21,720 --> 00:02:23,840 Speaker 1: the money, we are open for business. Is this the 49 00:02:23,840 --> 00:02:24,880 Speaker 1: government who can fix it? 50 00:02:26,120 --> 00:02:29,480 Speaker 2: Well, what I would say is it's a government where 51 00:02:29,520 --> 00:02:34,079 Speaker 2: you have people in the different organizations i'd say, different ministries, 52 00:02:34,120 --> 00:02:38,000 Speaker 2: different portfolios, talking to each other is important. That's a 53 00:02:38,000 --> 00:02:40,160 Speaker 2: big part of the reason the study was put together 54 00:02:40,360 --> 00:02:43,480 Speaker 2: is because this is at the intersection of immigration policy 55 00:02:43,520 --> 00:02:47,040 Speaker 2: and tax policy. So I think a government where you 56 00:02:47,080 --> 00:02:49,359 Speaker 2: have people that are talking to each other is very 57 00:02:49,360 --> 00:02:52,040 Speaker 2: capable of fixing this, and I do think the current 58 00:02:52,080 --> 00:02:53,480 Speaker 2: government is well placed to do that. 59 00:02:53,520 --> 00:02:55,800 Speaker 1: Good stuff. We'll appreciate it very much. Rob Connybey, who's 60 00:02:55,800 --> 00:02:58,360 Speaker 1: managing director of the US by a spentire capital firm Shasta. 61 00:02:58,919 --> 00:03:01,840 Speaker 1: For more from The Mic Asking Breakfast, listen live to 62 00:03:01,960 --> 00:03:05,000 Speaker 1: news Talks at b from six am weekdays, or follow 63 00:03:05,080 --> 00:03:06,639 Speaker 1: the podcast on iHeartRadio.