Trust’s $1m to council, government


Queenstown’s housing trust has been hit with a $1 million tax and council bill.

The not-for-profit Queenstown Lakes Community Housing Trust will pay about $650,000 in GST when it sells its affordable houses at Shotover Country.

It must also pay $460,000 in development contributions to Queenstown’s council.

Trust boss Julie Scott says the money could be used to build an extra 10 affordable homes for families who can’t afford the resort’s astronomical market prices.

She says the trust would love to see a GST waiver from government for approved community housing providers.

“We’ve raised it several times with government but they haven’t seemed that interested.

“If they’re serious about providing affordable housing this would help.

“We’d be able to assist more families.”

The trust’s $15 million development at Shotover Country is its biggest to date.

Forty-four community houses are on track for completion by the end of the year, on land gifted by developers Sharyn and Grant Stalker.

They range in price from $445,000 to $565,000.

Three-quarters are sold under the trust’s shared ownership scheme, with the rest retained for renting.

The buyers, who meet strict criteria in terms of residency, income and minimum deposits, buy 70 per cent of a house under the scheme. The trust owns 30 per cent.

But the trust must pay GST on the land component of those sales.

“It is a straight cash cost to the trust,” Scott says.

The government ducked Mountain Scene’s attempts to get comment on the policy of the trust paying GST.

Inland Revenue spin doctor Pete van Schaardenburg says “tax secrecy” stops it commenting on any taxpayer’s affairs.

He says the broad-base nature of GST ensures it’s “efficient, fair and simple”.

Housing and Building Minister Dr Nick Smith passed on the GST question but said the government had made significant changes for registered social housing providers.

The Internal Affairs Department also referred Mountain Scene to Inland Revenue.

The council takes development contributions to recover costs for providing infrastructure, like water and sewerage pipes.

Council finance boss Stewart Burns says: “If the developer does not pay for this infrastructure, it must be paid for by the ratepayers at large.”

Scott says outgoing founding chairman David Cole discussed the situation with the council but was told there were no exceptions.

Burns confirms this. Instead, the council has supported the trust directly through transferring land for development, he says, and arranging contributions from developers.

Burns says the $360,000 paid by the trust so far is a cash contribution of $9835 per lot.

For a section selling for $300,000, this equates to about 2.7 per cent of the cost.

The trust still has 300 families on its books.

The independent Charities Registration Board declined to register the trust as a charity.

Charities qualify for tax exemptions.

It said the trust is not focused on assisting only people in charitable need.