A leading economist says the National Party's revenue estimates on its newly proposed foreign buyers tax are "bullshit".
Sense Partners economist Shamubeel Eaqub appeared on Newshub Nation on Saturday morning, claiming the party's numbers don't add up.
He joins a list of economists and politicians who believe National's tax plan has substantially overstated the amount foreign buyers will bring in.
Earlier this week, National said if elected it would partially lift the ban on foreign buyers which was introduced by Labour in 2018. National would allow foreign buyers to purchase homes worth more than $2 million but will be charged 15 percent at the point of purchase.
Australian and Singaporean buyers would be excluded due to fair trade deal obligations.
National claimed the tax will bring in $740 million a year but Eaqub said the potential tax revenue from all properties over $2 million in New Zealand would be $1 billion based on the past 12 months. This means more than 70 percent of $2 million-plus properties would have to be sold to foreigners.
"It just doesn't make sense," Eaqub said.
"Whoever's done the numbers and who's done the quality assurance really needs to have a really good look at this stuff because I don't believe they've got it right."
National's deputy leader and finance spokesperson Nicola Willis told AM on Thursday they are confident in the plan's costings, pointing to the large amount of house price growth in New Zealand since the foreign buyers' ban was introduced.
But it's not just the cost that has experts concerned. NZME head of business Fran O'Sullivan told Newshub Nation she is worried about what this policy will do to house prices in New Zealand, given it will add more competition to the market.
"It gets the market going again but it gets it going at a time the squeezed middle is finding it hard, in some cases, to service mortgages or buy houses in the first place," O'Sullivan said.
She said by adding in more competition from foreign investors, as well as immigration, it could elevate house prices over time.
"That will be great for the base but it will still impact the squeezed middle."
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