Customs (Levies and Other Matters) Amendment Bill

I move, That the Customs (Levies and Other Matters) Amendment Bill be now read a third time.

This bill aims to improve revenue collection on goods by making collection fairer and more effective and supporting regulatory efficiency. It does these things by amending three existing Acts. Part 1 amends the Customs and Excise Act 2018, Part 2 amends the Waste Minimisation Act 2008, and Part 3 amends the Goods and Services Tax Act 1985 and the Customs and Excise Act 2018.

The amendments in this omnibus bill make small but important improvements to three existing revenue-collection regimes: Customs’ cost recovery charges, product stewardship fees, and goods and services tax. These types of revenue are all either currently defined as duties under the Customs and Excise Act or will be able to be defined as duties or treated as if they are duties once the bill’s amendments are in place.

The primary aim of the bill is to introduce a levy-making power so that levies can be made as an alternative to existing fee charges to recover Customs costs related to its goods management functions, including vessels. Levies are more appropriate than fees when costs are spread across a class of payers and there is not necessarily a direct line of sight between the costs and the payers. Customs’ goods management system supports trade and protects New Zealand. Trade is reliant on a small, efficient, and secure border that protects the legitimate flow of trade. The costs of Customs services and integrated goods management system, including the management of vessels, are best recovered from classes of levy payers that create the risks and costs.

This bill is enabling legislation. The primary legislation changes for Part 1 and Part 2 of the bill will require regulations of Orders in Council to implement the changes; the Goods and Services Tax Act changes in Part 3 do not. The bill amends the Customs and Excise Act to add a provision that empowers the Governor-General, by Order in Council, on the recommendation of the Minister of Customs, to make a levy order. Such a levy order would prescribe a levy that funds costs incurred by Customs in or for the purpose of performing a function under the Customs and Excise Act or other legislation relating to goods management. Later this year, in addition to the levy order, I will also be submitting secondary legislation that will include amendments to existing Customs and Excise Act regulations to reflect goods and vessel cost recovery policy decisions made by Cabinet.

Part 2 amends the Waste Minimisation Act to clarify that the Governor-General, by Order in Council, on the recommendation of the Minister for the Environment, may make regulations to specify persons that will collect funds to fund product stewardship. Future product stewardship schemes could use these provisions to provide for effective cost recovery of the product stewardship fees by agencies such as Customs. These would need to be provided for in regulations associated with those schemes.

Part 3 amends the Goods and Services Tax Act to ensure that imported goods valued over $1,000 receive the same GST treatment as other goods by broadening the criteria under which an importer can get a GST refund for returned goods.

The bill was referred to the Foreign Affairs, Defence and Trade Committee, which considered several public submissions on the draft bill. I would like to thank the select committee for its valuable consideration of the bill; in particular, they provided scrutiny of the proposed changes to GST refunds and sought confirmation that effective safeguards are in place to avoid fraudulent claims.

To summarise: this bill will modernise Customs’ cost recovery empowering provisions in the Customs and Excise Act and allow for the recovery of costs for Customs’ goods management functions through levies. This approach supports a more robust and balanced outcome. In addition, the bill makes changes to support the efficient future collection of product stewardship fees by other agencies such as Customs and makes GST refunds fairer. Again, I thank the Foreign Affairs, Defence and Trade Committee for its considered work and to those who took the time to provide submissions on the bill. I look forward to the passage of the bill. I commend the bill to the House.

Kia ora e te Pīka. Ngā mihi nui e Te Wiki o te Reo Māori. I’m honoured to give a speech on the Customs (Levies and Other Matters) Amendment Bill as spokesperson for Customs for the Labour Party.

On the face of it, this omnibus bill, which deals with three different Acts—the Customs and Excise Act 2018, Waste Minimisation Act 2008, and the Goods and Services Tax Act 1985—appears to be a reasonable measure that is proposing to modernise and improve how we collect revenue on goods, as we heard the Minister describe. The Government has repeatedly assured us that this bill is about improving the system, and it doesn’t change or increase rates or existing charges or introduce new charges.

At first reading, Labour approached this bill in good faith, supporting its referral to the Foreign Affairs, Defence and Trade Committee in the hopes that these measures would indeed deliver fairness without any unintended consequences. We supported the bill, as well, at the second reading. Right throughout the committee of the whole House, we were hopeful that some of the amendments that we tabled would be taken on board. However, as we have examined the bill in detail, especially Part 1 of the bill which overhauls the Customs and Excise Act, it has become alarmingly clear that the bill takes an unusual and, unfortunately, an alarming turn. After careful analysis of this bill, Labour can no longer support this bill in its current form.

Part 1 of this legislation is really problematic to us, and we prepared the Amendment Papers to try and fix the worst flaws. Our concern is that unless the bill is amended, Part 1 hands the executive a blank cheque with sweeping powers to impose new levies without any adequate checks. This bill does this in a way that threatens both fairness and accountability. Labour refuses to stand by and allow such an overreach to proceed unchecked. This is a bill that is not a confirmable instrument—and that was one of the Amendment Papers that we tabled—so that it will come back to the House for members of Parliament to have a say.

Part 1 of the bill grants the Minister of Customs authority to create an entirely new levy regime via regulations by Order in Council, by inserting new section 414A into the Customs and Excise Act. On paper, the idea of cost recovery or spreading border management costs across a class of importers rather than individual fees may seem fair. Indeed, using levies for cost recovery can be appropriate in some cases, and it is not unprecedented. This is something that we ourselves have done, but not in the way that this bill does, which is deeply concerning. Under the new section 414A, the Government could impose levies on virtually any person or any business involved in importing or exporting goods. The scope is astonishingly broad and ill defined. The Minister may call it “cost recovery”, but let’s not sugarcoat it.

This is, effectively, a new taxation power to allow the Government to target an undefined group of people for an undefined range of services and to charge them an undefined amount in levies, all without returning to Parliament for oversight or approval. One particularly concerning clause in Part 1 which exemplifies this overreach is new section 414A(2). As currently drafted, in clause 6 of the bill, it explicitly states that Customs may recover costs “without limitation”. In other words, the power to levy charges would be without limit, unrestrained, and indefinite. The phrasing is no mere technicality; it is an open cheque, because even at its most basic principle of lawmaking, writing the words “without limitation” into taxing power is extraordinary and, quite frankly, outrageous. No Government agency should ever be told that it can extract money from the public without limit.

This Parliament should not grant an open-ended authority to levy potentially hefty charges on our businesses and our consumers. Labour tabled an amendment to delete the words “without limitation” from clause 6, new section 414A(2). Those two words might seem small, but removing them is absolutely vital to rein in the bill’s sweeping scope. If the Government truly does not intend to create limitless charges, they should have no objection to striking that language out. Keeping it in law would send a signal that Customs’ powers to tax through levies knows no bounds. Not only is the scope of the levy power too broad but there is no robust check on the balance or its use. Under this bill, levy orders would be made by Order in Council, effectively regulating regulations decided by Cabinet, without needing further approval by Parliament.

Once this bill is passed, executive could bring in new hire levies at any time and members of this House would have no say beyond the blunt instrument of disallowing a regulation. That is simply not good enough when we are talking about charges that are, in all but name, a form of tax on the public. Historically, Parliament has been very careful when delegating taxation-like powers. Often, statutes imposing levies include provisions to ensure ongoing parliamentary oversight. In fact, many Acts in New Zealand require levy regulations to be treated as confirmable instruments, meaning any levy imposed by regulation must later be confirmed by Parliament to remain in force. This is a sensible safeguard that upholds the principle of no taxation without representation in our modern legislative framework. Yet this Customs amendment bill contains no such safeguard.

Actually, it omits any requirement for parliamentary confirmation of the new levies. Essentially, this bill asks us to trust the Minister of Customs entirely, to trust that she will only ever set reasonable levies, never abuse the words “without limitations” authority, and somehow always achieve fairness with no further input from the House. That is not how democracy is meant to work. Labour believes that if the Government truly intends these levies to be fair and limited, they should welcome transparency and oversight. Labour’s proposed amendment is not radical; it is common sense and in line with longstanding constitutional practice. I urge the Government to accept that amendment.

Beyond these constitutional principles, let us talk about the real-world impacts of this bill. Who will bear the brunt when the Minister unleashes these new levies under this law? The Government argues about fairness, spreading border management costs more evenly—but fairness for whom, exactly? From where we stand, it looks like these levies will not hit everyone equally; in fact, they are likely to hit small and medium sized businesses the hardest, along with ordinary New Zealanders who ultimately purchase imported goods. Make no mistake, these costs will be passed down the line. When an importer faces a new levy, they will try to recoup it somehow, usually by increasing prices for consumers. Ultimately, everyday people are likely to pay.

Labour has withdrawn its support for this bill in its current form precisely because we stand on the side of fairness and accountability. It is really cynical to try and say that scrutiny is not something that Parliament should continue to have. Having these costs, these new levies, without limitation, charging it to importation of exportation of goods, charging it to shipment, transshipment, and transportation of goods—actually, the other worry that we have is the fact that prohibited goods is one of the things that this bill basically says that should be charged a levy. Prohibited goods is usually one of those main responsibilities of the Minister of Customs, because the Minister of Customs is tasked with ensuring that our borders are safe and secure. Having prohibited goods not come through our borders is basically a public good. It should not be paid for by a levy that is charged to private companies and our importers and exporters. We do not commend this bill to the House.

The question is that the motion be agreed to.

Thank you, Madam Speaker. I rise in continued support of this bill from the Green Party of Aotearoa New Zealand. While we do share some of the concerns that have been articulated by Labour members in the previous stage of the committee and by previous speaker Jenny Salesa, we do think that the potential good that this bill could do outweighs some of the potential cons that it could impose. I was a little bit assured during the dialogue in the committee of the whole House stage that the “without limitations” clause basically just referred to the subsequent subclauses that are referred to in the legislation. That being said, if this bill does confer as sweeping of powers as our Labour colleagues do suggest that it does, then we’re looking forward to bidding for the customs portfolio in the negotiations for the next Government.

I want to talk a little bit about Part 2, which is one of the main reasons we’re supporting this bill. Part 2 is the section of the bill that amends the Waste Minimisation Act. The purpose of this is to enable priority product stewardship. I guess I want to talk about why this is really important by drawing on some of my past work in the past life where I was the waste lead at the Climate Change Commission. Now, one of the things that we were looking at there is the issue of refrigerants and controlling refrigerants, and one of the ways that you can actually ensure that you’re having some level of control over refrigerants—and refrigerants are the things that act as coolants and heat pumps and air conditioners, that kind of thing—and they need to be dealt with at the border.

Laura McClure: Really? It’s bad for the environment.

FRANCISCO HERNANDEZ: Yeah, they’re bad for the environment—absolutely. They’re actually really potent—really potent in a global warming sense. That’s why one of the policy recommendations that we had that we talked to officials on and we talked to the community on when I was at the Climate Change Commission was to ensure product stewardship legislation for refrigerants. It really makes sense to have Customs as the body that actually, literally deals with the import of goods at the border—to have that be the agency that administers the product stewardship scheme. That’s why we think that this legislation is a really positive step forward. Notwithstanding ignoring the concerns that our Labour colleagues have articulated, our view is that this does make it a little bit worth it.

But we’re not supporting this bill with a kind of notion of naivety. We do know that the Minister has provided some assurance during the committee of the whole House stage that this Government does not intend for the product stewardship fees to be used as general parts of the revenue. But we do know that, sadly, during their term in Government, they have used things that have similar structures to fees or levies and then broadened them out for a general purpose. For example, one of the first things that this Government did when they came into power was to change it so that the revenue from the emissions trading scheme no longer went to the Climate Change Response Fund, which was a big loss, in my view, because the Climate Change Response Fund was a fund that was set up to fund not only climate change mitigation but also climate change adaptation measures.

The loss of that was one of the things that the Government first did when they came into office. This is why I’m a little bit sceptical when the Minister does provide reassurances like that; it doesn’t seem to accord with, sadly, the record of this Government. One of the other things that they did just right at the start of my term as a parliamentarian, actually, was to change the Waste Minimisation Act. This bill also makes changes to the Waste Minimisation Act, but they changed the Waste Minimisation Act at the start of last year to de-hypothecate the Waste Minimisation Fund and broaden the scope for that.

Now, that’s significant because, as set up, the Waste Minimisation Fund was supposed to use the waste levy and fund it and use the money to fund purely waste reduction initiatives with the objective of making New Zealand a zero-waste country. I do take on board the Minister’s feedback that this Government does not intend to use the ability to set fees through the priority product security and use it on other things, like general things—for example, subsidies to fossil fuel companies. That would be a very bad thing to do, in my book. Sadly, you know, we do have to treat the Minister’s claim with a little bit of scepticism. That’s why, while we are supporting the legislation in Part 2, and while we are supporting the overall thrust of this legislation, we are coming into it with eyes wide open.

I want to turn to Part 3 of the bill, and Part 3 is also something that potentially supports the objectives of waste minimisation in quite an indirect way. I’ll explain why it’s quite indirect, because it doesn’t directly—it’s not like the previous section, which directly amends the Waste Minimisation Act. The way that Part 3 does this is that currently, when you send goods overseas to be repaired, there’s the potential that when they come back, you’re potentially having to be paying twice for that. This legislation makes the changes so that if you pay for a good once and then you pay the GST on it and then it breaks for whatever reason and then you send it overseas and it comes back, you’re not paying a double fee for that, which isn’t really conducive to the idea of having an economy—a circular economy.

I mean, we know that certain members opposite don’t like the word “circular economy”, but that does support the objective of a circular economy, which is one of the things that is necessary to shift New Zealand into a cleaner, greener, and zero-waste future. We do have other things that, you know, while this bill will only play a very small part in enabling better repairability of goods and services in New Zealand—I don’t want to over-egg the pudding too much; it’s not going to be like a very, very big role—it is good step in the right direction, of being able to ensure that that we’re lowering the barriers for people to be able to repair products.

I mean, it’s a shame that my colleague the Hon Marama Davidson’s Consumer Guarantees (Right to Repair) Amendment Bill is not being—

Dr Vanessa Weenink: Well done. You’ve only got two more minutes. You can make it!

FRANCISCO HERNANDEZ: Yeah, two more minutes—carried on by this. Well, it hasn’t actually come to the House yet; there’s a potential that the members opposite might come to a road to Damascus moment. We’re certainly hoping that they do, and we’re certainly hoping that the objectives of this, which is to enhance repairability, does carry on to the wider programme of this Government, including supporting the right to repair legislation of the Hon Marama Davidson, because shifting to repairability is right and this bill does help enhance that slightly. It’s a really good way that we can reduce waste.

Now, finally, with only around one minute left to go, I really want to turn my attention and really make sure to thank the people who are staffing the border at customs. I mean, I think like many New Zealanders who’ve had to travel or return overseas, I was struck by the professionalism and the integrity and just how quickly you can actually go through the border these days. I think that part of this legislation is actually enabling cost recovery to support the good work of the men, women, and non-binary staff right at the front lines of customs.

With about just 15 seconds left—well, 12 seconds left of my time now—I do want to issue a note on process. I really don’t think we needed to use urgency to pass this legislation, but if we’re going to use urgency, we’re going to drag it on for as long as possible.

Thank you, Madam Speaker. I rise in support of this bill and ACT’s position. Look, I find it kind of ironic that the Labour Party, despite supporting this bill entirely, decided to pull the pin last minute, raising, actually, some fairly good points, but it leads me to the question of the Foreign Affairs, Defence and Trade Committee. We’re a great select committee—and I’ve got some of my colleagues over here—and these points could have been discussed and they weren’t raised with us. I think the members on that side may have just done their homework tonight and got a speech written by ChatGPT, but these are serious concerns. Maybe if the members want to engage with us on some of these matters, they should look at doing that via the select committee in the future.

I think this bill’s really sensible and makes it nice and easy. Being able to get your GST back on refunds on products over $1,000 that you import, that’s really sensible and that’s a good step forward. I commend this bill to the House.

Thank you, Madam Speaker. It’s a pleasure to take this call here in the final reading. I appreciate the support of the Green Party—even with some mixed metaphors there—but we’ll take that support. That’s the way the cookie bounces! Ultimately, this is a good piece of legislation, despite the scaremongering from the Labour Party, which, actually, was not raised at any point during the select committee consideration. I’m not sure where it’s come from now, other than perhaps a misguided interpretation of this bill. Actually, we saw them concerned for the first time about the potential of increased tax. It’s a very un - Labour Party thing. I was surprised to hear that coming from the member. Rest assured that that, indeed, is not a risk under this legislation. These are pragmatic changes that bring efficiency and, ultimately, will improve delivery, the hallmark of this Government.

I rise on behalf of the Green Party to speak at the third reading of the Customs (Levies and Other Matters) Amendment Bill. Now, I did read the title because in the second reading there was a bit of confusion as to whether I was talking about the right bill—so just clarifying that, absolutely, product stewardship and waste minimisation is a really important part of this bill. For the Greens, the most important part of this bill is the product stewardship and the progress it makes on waste minimisation. This is a kaupapa that is part of our whakapapa.

The Waste Minimisation Act 2008 began its life as a Green Party member’s bill and was championed by former Green MP Nándor Tánczos, who is running currently for Mayor of Whakatāne. The Hon Eugenie Sage, when she was the Associate Minister for the Environment, did amazing things with products stewardship, bringing in six priority products including things like tyres and e-waste. I was actually on the e-waste products stewardship working group when I worked at Para Kore and then went on to work at the Ministry for the Environment, so I know how massive our waste problem is and how big the waste department at the Ministry for the Environment is.

There are some really amazing solutions happening out in the communities and product stewardship is one of those really exciting things. This bill carries that kaupapa forward. The Waste Minimisation Act 2008 was the first time Aotearoa recognised that responsibility for waste must be shared with producers and importers, not just by households, councils, and, ultimately, Papatūānuku—our Mother Earth.

By enabling the changes to the Customs and Excise Act 2018, the Waste Minimisation Act 2008, and the Goods and Services Tax Act 1985, this bill closes a crucial gap. It makes sure that when tyres, electronics, or packaging come into the country, the cost of dealing with those products at the end of their life are not simply dumped on whānau, communities, and into Papatūānuku that she cannot digest.

This is about shifting the responsibility upstream to those that design and profit from products. Now, a great example of this is in the EU, in Belgium, where Apple changed their chargers to USBCs in line with regulation to reduce that e-waste. Now, you might not have known why the iPhones now have that C charger, but it was because laws can put the onus on producers to create products that reduce e-waste and waste in general. Every step in this direction is a win for our communities, for our councils, and for Papatūānuku.

This bill also makes GST rules fairer for repaired and replaced goods. I want to shout out to my colleagues here Ricardo Menéndez March and the Hon Marama Davidson for their work on the right-to-repair bill—which I actually helped with before I was an MP. This is something that is core to our beliefs as the Greens. It is that belief that we should honour. When we extract something from the Earth, we should honour it; we shouldn’t just produce it into something, consume it, and then throw it away—a straight line all the way to the rubbish dump. What we need to do is move back into circular systems. That means making sure that producers are responsible for the products that they make at the end of their life. We are so far behind the rest of the world on this. I mean, you only have to look at European nations to see that we really, really need to catch up.

People are making conscious decisions to reduce their carbon footprints, but the throwaway system—that linear system that we live in—does not allow them to do this. The technical changes like this can help us move towards a system of sustainability. The Green Party is proud to support this bill, even though it is a small step and there is so much further we need to go. Thank you, Madam Speaker.

I never thought I’d say this but I’m looking forward to hearing from the Hon Peeni Henare in a minute, I would assume. The last Labour Party’s “Penny”—“Henny Penny” thought the sky was falling with this bill. It’s ridiculous.

It’s a great bill. It’s about a Government getting on with the business of running a country, going for growth so that we can make life more affordable and deliver more opportunities for Kiwi families. I commend it to the House.

That member’s in luck, and I can guarantee that member that my speech will be longer than his tie!

Madam Speaker, I thank you for the opportunity to speak on this bill and want to reiterate a few points that I thought my colleague the Hon Jenny Salesa spelled out quite clearly in the House, and I want to touch on a number of those points.

One of the terms that I didn’t hear from the Minister throughout the entirety of the process of this bill in the House was something that I think would actually resonate with the community out there, which is “fiscally neutral”. We kept hearing from the Minister how this is designed so that it can be a cost recovery, so that we’re literally paying for the management system that will look after the management of goods at the border. But what we didn’t hear was that it would be fiscally neutral. I think that’s one of those terms that is really important when we look towards whether it’s a tax or a levy, something that’s being explained to the people as simply being cost recovery for the management of goods at the border should be something that’s fiscally neutral. Something that tells New Zealanders, tells small to medium sized enterprise business owners that actually they’re getting good value, they’re getting an efficient service, they’re making sure that when they’re looking towards importing goods here into this country and exporting—in a case which I’ll touch on very shortly—that it is fiscally neutral and gives the public the reassurance that those systems are in place to protect our borders.

I’ve just returned from Papua New Guinea where they celebrated the 50th year of independence. One of the matters that was raised with myself in the discussions in and around the functions and the ceremonies that I attended from the Pacific Islands were the challenges of transnational crime—and the fact that we need to make sure we have strong borders, and, for the most part, we do a good job. The New Zealand public want to know that whenever we’re looking towards taxing or putting a levy on something, that those costs will go to something that will make sure that things like our borders are protected, that transnational crime is something that’s taken seriously—and for the most part it is. But what we need to do is make sure we take the public on this journey. There are still some unanswered questions, and one of those is from the Minister on whether or not there will be a fiscally neutral pathway forward on this particular bill.

The amendments to the bill that were proposed by my colleague, I thought were, at least, reasonable. I’ve heard members from the other side of the House say that it should have been raised in the Foreign Affairs, Defence and Trade Committee. Well, that’s why we still have the committee of the whole House. That’s why we have that opportunity, so that we can bring these matters once again, after hearing from submitters, after going through the processes of the bill, we can still make a bill better. That’s the point I want to leave on members of that side of the House. The reason we don’t have that opportunity is because this bill’s being pushed through under urgency, and now we find ourselves going through all stages of the bill. That’s the challenge that we put in front of the Government and also the public out there, who I’m sure will have some very clear and strong views and some expectations when we look towards the passing of this bill.

I want to acknowledge my colleague the Hon Damien O’Connor, who spoke to the amendments to the Waste Minimisation Act, which is amended in Part 2, and I think they’re really good. They do ask some questions though, and I want to acknowledge the comments of my colleague the Hon Damien O’Connor, who actually had thought that this Government had given up on any green initiative in this country, and now, all of a sudden, we’re trying to make amends. We’ve heard the term “road to Damascus” several times during question time, and I think that might be one of those opportunities to use the same phrase to say it is about time that the Government under its leadership looks towards parts like the amendment to the Waste Minimisation Act—something that says “To those that provide products, there must be some kind of recourse or some kind of pathway that shows that we can make sure that our environment is looked after into the future.” I think the example of the charger, the universal charger for Apple iPhones, is a really good example of that.

I do think that there were some questions about today’s and tomorrow’s technologies which I wonder will have to come up through secondary legislation or at least be defined more clearly in the bill. One of those was lithium batteries, and we know with electric vehicle cars and all that, there are concerns about the way that lithium battery is disposed of, etc., and I think those are all questions that New Zealanders have on their minds. When we look towards anything to do with the Waste Minimisation Act and the way that we might present ourselves as a progressive country, I think those are some serious things that we all have to consider as a House of Parliament and as representatives of the people.

I mentioned in my contribution in the second reading and in the committee of the whole House, the Legislation Design and Advisory Committee of 2021 and the recommendations that they make around ensuring that good legislation and good process is undertaken to make sure that we have good and strong and robust legislation. I made the points earlier about some of the questions that, from their perspective, needed to be answered in order to ensure that we aren’t simply using this House to impose taxes, which is why there is a separate pathway for very clear taxations. Then there is another pathway which talks about levies. It does make a distinction between the two, which I think is important, but also it speaks to the kinds of questions that the House needs to ask itself if it’s going to do either one of those two. Some of those questions, I think, are quite reasonable and quite simple.

The terms of empowering provisions is the first one, and whether or not the appropriate circumstances for secondary legislation are in place. I’m sure some of my colleagues in their contributions to the House this evening can talk towards how secondary legislation is important and can’t simply be seen as a process whereby we can have efficiencies. We heard from members on the other side of the House on how this is making things more efficient. While we are all for efficiencies, when it comes to matters like this, the Legislation Design and Advisory Committee made it clear that secondary legislation had to make sure that there were appropriate circumstances in place in order for those to happen. Otherwise, what we see is an erosion of democracy. What we see is the power being put into the hands of a few, and that’s not what we want in this country. I’m sure the public can make an argument that, actually, they’re not being heard in this case because we acknowledged during the process of this bill that this bill affects quite a large number of people in our community.

Some of the other questions that they asked and need to be answered to make sure that our legislation is good and robust, are things like the costs. What we’re saying here is the cost of providing the service and whether or not it’s relative to the income that’s being taken in. While there were some assurances from the Minister, I come back to my point about fiscal neutrality and making sure that it’s clear to the New Zealand public that what’s actually being taken in is reasonable and covers the costs of the service to take that money in or to levy that particular service. That’s important because otherwise what is often the case is the perception in the public and in the community is, once again, that this Government is using underhanded tactics to continue to tax or levy communities.

Those are questions coming from the community, and while members on the other side might not like those questions, they are real questions. The other one is: who do the changes apply to? Who do the changes apply to? I think there is some really good questions put forward by my colleagues on this side of the House about not just small to medium enterprises and the changing nature of the way that New Zealanders purchase their goods online, etc., and the origin of purchase or the origin of certainly the company selling as opposed to the distribution point. I’m not an expert on the matters, but I do shop online, and I know others in this House do. We’ve got to ask questions about where that comes from. Do these matters apply to those who are selling? Are those companies offshore or are they companies here in New Zealand? The Minister made a point about the threshold being at $1,000. Well, that’s quite clear to me, but still, these are the questions that need to be answered to make sure that we have robust law.

Why is that important? Because, ultimately, it comes down to a constitutional matter. Constitutional matters that say this is the House of the people, this is the House that represents the views of the people, and the more and more I’ve seen over my 11 years here in Parliament is that often there are attempts to make sure that the power rests in the hands of the few. That can’t continue. If we want to make sure that this House continues to represent our country today and into the future, we’ve got to make sure that democratic processes are strong, robust, and sound.

On that matter—in the last five seconds—we won’t be supporting this bill. We’ve tried to make it better. Sadly, we couldn’t.

Look, I’m pleased to stand and take a call on the Customs (Levies and Other Matters) Amendment Bill in this, the third reading. I do find it extraordinary that many of the questions raised were not asked in the select committee process by the other side. I think that is the place where they should have been asked, and if they weren’t, then that is something that could be addressed by them in the future.

This is a levy regime. It’s more appropriate and best practice when costs are to be spread fairly. It’s a good bill and it helps us to make collection fairer and more effective. We need to be faster as a country. We need to be more effective and more efficient, and this will do that. As a result, I commend it to the House.

Tēnā koe e te Mana Whakawā. Look, this is an exemplar for lazy lawmaking. It’s just sloppy.

Laura McClure: Lazy homework!

Hon Dr DUNCAN WEBB: Yeah, because I’ve had a good look at this piece of legislation, and a good starting point is the regulatory impact statement. A good regulatory impact statement steps through the policy problem, puts forward a range of options, and measures them against each other on a number of fronts. It’s not easy, but it’s good policy work. I’ll be honest: I feel for the officials who might look at this, but this is one of the worst regulatory impact statements I’ve ever seen. I mean, the options it has presented are to do nothing—the status quo—or to do what the Minister says. There is no challenging, there’s no testing, and there’s no going forward and saying “What other ways are there to address the problem?”, because the problem here is that the current fees regime isn’t working quite right.

When you import goods and, for example, they have to be inspected and there’s a cost to that inspection, that is a classic example of where a fee should be charged, because we know what the job is and we know what it costs. But that’s all a bit too hard—they don’t want to explore how to improve that framework; they want a levy system.

Now, a levy system is used where it is impossible to differentiate who bears the benefit of any particular piece of work. A good example is marketing by produce boards like Zespri and the levy for kiwifruit owners: you can’t charge a fee for the marketing for any given orchardist; or there is border protection against Mycoplasma bovis: you can’t say “This work benefited that farmer.” That’s where a levy is suitable. That is what a levy is for—to spread the costs across a population of people who benefit from a particular Government activity—but this isn’t it.

That’s why this is lazy lawmaking. There has been no genuine exploration of what the best fix for this fees regime is, and we do have real concerns that what this really is is a money-grab, because we know that that Government over there has put up Government fees across the board. A good chunk of the inflation in our economy is being driven by increasing costs in Government sectors. Whether it be car registrations, fuel taxes, court fees, or whatever it might be, that’s administered inflation, and they’re administering it. Here we have another opportunity where the Government is grabbing unto itself the ability to impose more cost that, ultimately, New Zealand consumers will bear, without there being any accountability to this House.

Jenny Salesa had her amendment on the Table that said that if you’re going to do that, make it confirmable. Make it so that it has to come back to this House and say that we approve that legislation, and then we can examine it. At least the Minister would have to front up and answer the question as to how it was justifiable.

Now, I’m concerned that these levies will be put through without the appropriate consultation. There was no consultation on this bill before it came to the House, and that’s shocking. This directly affects importers, exporters, and consumers, and yet the regulatory impact statement is quite up front and says, “No, we didn’t do any consultation. We’ll do that when we impose the levy.” That is sloppy and it’s lazy, and, quite frankly, from a Government department, which is, in fact, our oldest—the Customs Service, I think, if I might have this right, is our oldest Government department—I expect more.

That’s not good lawmaking from Customs, and I’m really concerned that what we have here is a situation where the Government is like “Oh, I can’t really be bothered doing the work to charge fair and accurate fees. Let’s just have a blanket levy. It’s so much easier, and”—as my friend and colleague Peeni Henare said—“we can be a little looser about it. It doesn’t have to be cost-neutral. We can make a little bit on the side. We can have a bit of an uplift there, as well.” That’s not good lawmaking; in fact, it’s unconstitutional.

A levy, as the Legislation Design and Advisory Committee says, should only recover the cost it needs, and that’s not what this bill does. It’s bad lawmaking, it’s going to increase costs, it’s bad for importers, it’s bad for consumers, and—most importantly—it’s bad for New Zealanders. We will not support this bill.

Thank you, Madam Speaker. It’s a pleasure to take a call on the Customs (Levies and Other Matters) Amendment Bill. It’s a useful piece of legislation, and I commend the bill to the House.

Hon Damien O’Connor: Madam—Madam Speaker?

Are you sure?

Hon Damien O’Connor: Yes, Madam Speaker.

ASSISTANT SPEAKER (Maureen Pugh): The Hon Damien O’Connor.

I wouldn’t miss it for quids. Thank you, Madam Speaker. No, look, it’s a privilege to get up and speak on this bill, a piece of legislation that has been through the Foreign Affairs, Defence and Trade Committee, but things have moved on a little bit—things have changed, and I guess we have every reason in the Opposition to just scrutinise the legislation one more time. There have been some excellent speeches from my colleagues who, rightfully, have pointed to a number of concerns. I have to acknowledge the Minister who stood up and answered most of the questions that we had.

I want to thank her for that, but she is still part of a coalition Government that has actually increased fees wherever they can and taken as much money from people as they can back into the consolidated fund to pay for tax cuts. It’s as simple as that: increasing vehicle registration fees back into the consolidated fund, increasing the international visitor levy from $35 to $100 into the consolidated fund. Indeed, we’ve moved away from it, and we, in Government, of course had a philosophy—and it’s been one that has been generally accepted across the parties—of user-pays. I think that’s a fair way to go. We don’t want taxpayers money subsidising particular areas. We’ll assist when necessary, but not subsidising areas of the economy.

When it comes to import and exports, then those people who are moving goods should pay, and this is what this bill is about. It’s designed to, I guess, update and modernise the legislation, but what it does do is shift from a process in Parliament of oversight to a process with the Minister, where there are obligations to consult but they are not that robust, and we say they are at risk of being abused by a Minister who just decides to cover costs and a bit more, as my colleague previously said. Indeed, this goes on all the time.

There is a memorandum account or a structure like that, we are told, and that will be reviewed and audited. So, you know, there are some checks and balances, but, as I say, in an environment of suspicion because of other pieces of legislation that have either been rushed through—indeed, we’re in urgency, so we have every reason to be a little bit suspicious—or designed, as I say, to shift costs often from industry on to taxpayers or ratepayers; in this case, people who are importing and exporting things. This is a core part of our economy, and we need to make sure that we’re not kind of lumping them with additional costs.

The reality of these changes—from submitters and from our observation—is this will likely shift more cost on to small and medium enterprises. At a time when the Government says it’s wanting to kind of boost the economy, they are at the heart of our economy. So it is possible, because of the new systems that Customs might impose upon them for payment, that it might indeed increase or it’s likely to increase their costs. That’s certainly what all of them said when they came to the select committee.

But, hopefully, it might make the collection process a little more simple, given that it’s through Customs. They have a track record of collecting fees through alcohol and through imports, and so they have the capability to do it. Do they have the resources? In fact, it was very rarely raised or spoken of in the Minister’s reply here to questions that we asked. We see across all areas of Government service that the squeeze is on. All those agencies have been asked to claw money back and put it back to pay for tax cuts, and that has come at considerable cost and, we say, risk. We’ll just see what that delivers over time.

The second part, Part 2 of the bill is the Waste Minimisation Act amendments, and where there is an ability to, I guess, take a product stewardship fee. In Government, we had proposed six of these fees. One of them has been implemented for tyres. We had an assurance from the Minister that the others will be progressing. We shall hold our breath and hope that they do come through because the one for tyres was indeed a charge on tyres that helps with the disposal and the processing of them.

There are many other areas, as was spoken of, of course—that might be plastics, it might be batteries that we’re seeing more of across the economy. It is important that the Waste Minimisation Act amendments that pass through this piece of legislation do work effectively. Again, concern from small to medium sized enterprises that this is going to be an administrative cost on them when the Government says they’re getting out of the way of business and letting them get on with it. Well, this is not the situation here, so let’s just talk about the reality.

The third part of the legislation is GST amendments for imported goods, and it’s a slightly complex, technical issue around goods that someone might purchase for over $1,000 from offshore, bring into the country, and then find that they are faulty, send them back out, and then the replacement goods incur another GST charge, and so this bill will allow that to be offset.

In summary—and I won’t go on and take the full time—it is important that pieces of legislation passed through this House in urgency are given the full scrutiny, are tested by the Opposition. Otherwise, we end up with—and, actually, even with full process—faulty legislation because the reality is that the world moves very, very quickly and moves on. We struggle to keep up with innovation through regulation, and so when you kind of do stuff like this in a rushed manner, the chances are that you might make some mistakes.

Labour sees the general value of this, but we do have some questions around, I guess, the potential and the temptation for the Government of the day—that is, the coalition Government—to screw more money out of importers and exporters through the Customs (Levies and Other Matters) Amendment Bill. We, in Opposition and when we’re in Government next year, will make sure that this is a very fair process for all of those people who are engaged in small to medium sized enterprises and in enterprises across our country. It’s a pleasure to speak and, as I say, to keep the Government honest in a very important area of our economy.

I rise in support, in this third reading, of the Customs (Levies and Other Matters) Amendment Bill. Of course, a lot has been said about this bill in the previous readings. We’ve had some of the Green Party members say that they’re just filibustering, even though they support it. I don’t think there’s much more to say on this bill. I commend it to the House.

Thank you, Madam Speaker, for the opportunity to take the final call in this important debate. We are in urgency, and we find ourselves here considering a Government introducing a boundless taxation ability for a Government department. We are back to the 1980s where New Zealand will be governed by a capricious and voracious executive Government and someone in the deep bowels of the bureaucracy will decide what New Zealanders pay for their consumer goods and their alcohol and their cigarettes—somebody who is not accountable to them. It won’t be the member for Northland sitting there. He’s a local representative. He gets down to the pub, talks to his constituents, and works hard—it’s not him. He won’t be responsible for these new levies and their very tax-like powers. Laura McClure, who is accountable to her constituents and works hard as a list MP, won’t be accountable for these decisions. No. It’ll be someone somewhere at an office deciding what to levy next.

That is the proposal in this bill, a boundless power that will be used at the whim of Customs to introduce some sort of levy, and we don’t know what it will be. It might say that these might be cost recovery related. We might hear from the Minister that these are intended to be fiscally neutral. If that was the intention in the legislation, perhaps the legislation would say that. Perhaps it would be in the law that the intention of this would be to spread costs more fairly or to present them in a fiscally neutral way. That is not what the provisions say. The provisions allow an open-ended levy-making power on goods coming into New Zealand.

Let’s just think about that. Let’s think about a Government that is proud of its record on intervening in the supply side of things, like housing and the cost of living, making more things available, making the crisis of affordability something that families can get through because they’ve intervened on the supply side and made more things available. This does the exact opposite.

I hear the contributions of the ACT Party members in this House worried about the Labour Party members now raising this with them. Is it because, if they had had this pointed out to them, they would have realised that this is completely at odds with their ideology? We have an ACT Party here who has gleefully voted for a boundaryless taxation power where nobody knows what New Zealanders will be charged. Now, they raise with us, the Labour Party members, that we did not ask these questions in front of them adequately. That is what a committee stage is for. Page 493 of McGee is the place where members on that side were confused about the role of the committee of the whole House, especially in urgency. They might like to refer to it about how these questions are raised and how amendments by our spokesperson for Customs, the Hon Jenny Salesa, would be put to solve this problem in a way that is cross-partisan and in a way that you might expect for a piece of legislation like this, which is serious and will cost New Zealanders tens, hundreds and, in some cases, thousands of dollars a year.

We might be able to agree in a cross-partisan way, at the committee stage, that there should be an amendment to at least look back at the function of these levies—as democratically elected representatives, as hard-working members of Parliament who go down to the pub and talk to people about how these things are affecting them. But, no, the Government voted that down. The Government has actively voted against any accountability for these levy-making powers, which are extremely tax-like in nature.

I ask the ACT Party members: what if this was on the other foot? What if the left had come to the House today and introduced a bill to introduce a random tax that could be levered by a Government department? There would be outrage on the other side. We would have decrying that we were going back to a system of executive Government that we have well passed.

Just in this House tonight, we had the Rt Hon Sir Geoffrey Palmer up on the podium talking about the need for more cross-partisanship around this style of executive Government. He has been a great advocate for regulation being a real worry for New Zealanders that we need to deal with and that there is goodwill to continue to deal with in this term, because of this interest from people around the world in supply side economics and the need to get rid of unnecessary barriers and tricky fees like this, which are built into our economy and which are costing people more. Families in New Zealand know it. Under this Government, administrative inflation has hit a 30-year high at 10.8 percent. This will do it more. This will make it worse. This will make it harder for working families.

I declare the House in committee for consideration of the Climate Change Response (Emissions Trading Scheme—Forestry Conversion) Amendment Bill.