# National won't back Act's tax relief policy for property investors

> National rejects Act's proposal to give residential property investors tax relief through negative gearing.
- Title: National won't back Act's tax relief policy for property…
- Summary: National rejects Act's proposal to give residential property investors tax relief through negative gearing. National opposes Act's policy to allow…
- Keywords: national, act, negative gearing, tax relief, residential property investors, nz government, fiscal policy, tax policy, property investment, tax cuts, politics, news
- Source: NZ Herald — https://nzherald.co.nz/business/personal-finance/tax/national-wont-back-acts-policy-to-give-residential-property-investors-tax-relief-by-enabling-negative-gearing/premium/PSXVUPCFB5EWTJH5SHTSD7VG5A
- Read time: 2 min
- Topics: national, act, negative gearing, tax relief, residential property investors, nz government, fiscal policy, tax policy, property investment, tax cuts, politics, news
## National's stance on Act's policy
National's finance spokeswoman Nicola Willis stated they don't support Act's policy to give residential property investors tax relief through negative gearing.

> I don’t support Act’s policy
## Act's negative gearing proposal
Act proposed allowing residential property investment losses to reduce other taxable income, such as wages and business income.
## Tax relief example
An investor with a $10,000 loss and $100,000 salary would pay tax on $90,000 of income under negative gearing.
## Current tax rules
Under current rules, investors cannot deduct losses and pay tax on full income without offsetting losses.
## Act's rationale
Act argued negative gearing would attract more investors, increase rental supply, and put downward pressure on rents.
## National's priority
Willis stated National will prioritize fixing the country's finances before adjusting tax brackets for inflation.
## National's next steps
National plans to focus on business growth and worker incomes once the country's finances improve.
## Loss ring-fencing rule
New Zealand introduced a loss ring-fencing rule in 2019 that prevents owner-occupiers from offsetting interest expenses against taxable income.
## Act's cost estimate
Act estimated its policy would cost the Crown $246 million in the first year, rising to $303 million in the fourth year.
## National's position on fairness
Willis declined to comment on whether Act's proposal for negative gearing is fair.
## Australian comparison
Australia recently introduced a loss ring-fencing rule similar to New Zealand's with an exemption for new builds.
## Inland Revenue data
Inland Revenue reported 163,050 investors carried forward $2.8 billion of losses from the 2024/25 tax year.
## Act's tax policy focus
Act is campaigning to make KiwiSaver returns tax-exempt, not to provide immediate tax cuts.
## National's fiscal stance
National believes the country's finances are not in good enough shape for income tax cuts.
## Act's policy impact
Act's policy could reduce property investors' tax bills by about $300 million annually.
## What happens next
National will focus on fiscal surplus before implementing tax relief measures for investors.
## Key takeaway

National opposes Act's policy to allow residential property investors to use losses against taxable income, prioritizing fiscal surplus over immediate tax cuts.