Chlöe Swarbrick and David Seymour have traded barbs on AM over the Government reintroducing interest deductibility on mortgages.
Associate Finance Minister David Seymour announced on Sunday landlords will be able to claim 80 percent of their interest expenses from April 1 2024 and 100 percent from April 1 2025 onwards.
But reaction to the new policy has been swift, with new Green Party co-leader Swarbrick slamming it.
"The Government announced and David himself fronted the fact that with interest deductibility returning, the Government is prioritising the better part of $1 billion going into landlords' back pockets during this ostensible cost of living crisis," she told AM.
The long-signalled reintroduction of interest deductibility has been controversial, with the Council of Trade Unions (CTU) claiming the cost will blow out by $1 billion over four years and turn hundreds of landlords into tax-cut millionaires. The opposition says it will make landlords richer at the expense of other priorities.
However, the coalition Government has argued removing interest deductibility creates more costs for landlords, which get passed on to tenants, pushing up rents and increasing the cost of living.
Swarbrick added the Government's policy comes after IRD and Treasury said last year that the wealthiest Kiwis' effective tax rate is less than half of middle New Zealand.
But Seymour was quick to hit back at Swarbrick's comments.
"This is what I mean by demonising people and this is what I mean by the politics of envy, that's my challenge to Chlöe is to stop doing that," he said.
Seymour also criticised Swarbrick's claims about the amount of tax the wealthiest Kiwis pay.
"If you take somebody's paper profits, i.e. if you own a house and the value goes up, then they're just counted as income for the year," he told AM.
"If you were to take that seriously, then every time someone's house went up, we would have to tax them... that's how they've [the Greens] tried to say that people who have investments are paying less tax because they don't pay tax on their paper profits every year."
He told AM Swarbrick's comments are "frankly totally disingenuous" and "totally untrue".
"It's another thing Chlöe repeatedly says that is designed to set people against each other. It misinforms and you should stop saying it," Seymour said.
But Swarbrick was quick to fire back telling AM there is no evidence rents will go down under the Government's new policy.
"The facts are this policy will cost i.e. it will deduct from forecasted government revenue approximately $1 billion, which could be spent on other things," she said
Questions then turned to ACT backtracking on a coalition commitment about the new policy. There is no provision for landlords to backdate interest deductibility to the 2023/24 year, despite it being in ACT and National's coalition agreement.
Seymour admitted in "black and white" the coalition commitment says landlords should be able to backdate interest deductibility, but he shrugged it off when questioned about it on AM.
"One thing people want from politicians is people who A, can be really truthful and B, people that can actually say, 'look sometimes it's not the best idea to do this right now, we're going to do something different'. Sit around the table, talk with your coalition partners and come up with a better answer," he said.
Seymour told AM it was ACT's decision and there was no "massive fight about it" with coalition partners.
Watch the full interview above.
