Prominent NZ businessman says he will shut up shop if Greens get their wealth tax

A prominent New Zealand businessman says the Greens’ proposed wealth tax would “damage” the future of New Zealand. 

Eric Faesenkloet, founder and chairperson of Golf Warehouse, made the comments in an open letter to Green Party co-leader Chlöe Swarbrick. 

The Green Party has proposed a super-rich tax of 2.5% on net assets above $10 million. 

In his open letter, Faesenkloet said he paid a combined tax contribution from PAYE, GST, income and company tax of more than $8 million annually. 

“I started my first business at the age of 20 (52 years ago) and have built up a number of successful ventures paying more tax every year ever since,” he said in the letter. 

“In this career I have employed and given jobs to over 1000 employees. 

“I have also donated millions to charities around the country. 

“Your proposed wealth tax would make me pay a considerably higher tax than I have ever drawn and would disincentive [sic] to me to continue my existing business. 

“In fact, I would probably just close the operation down resulting in 200 job losses, 18 empty large buildings, and no further tax contribution to the government purse.” 

Faesenkloet said a flat wealth tax would have “significant consequences for our great country that could very well damage the entire future of New Zealand”. 

Golf Warehouse founder and chairman Eric Faesenkloet. Photo / Norrie Montgomery 

Speaking to the Herald, Faesenkloet said the Greens’ proposed wealth tax would disincentivise people to “get out of bed and work hard”. 

“In my situation now, after building up an asset base over a period of 50 years of working hard, to turn around and have to pay more tax annually than what I actually draw out of the business would be a disincentive to actually go out and give 200 people jobs,” he said. 

“For me, I just wouldn’t see the incentive to carry on doing a big business.” 

He said New Zealand already had high taxes. 

“In my business I pay an ACC levy, an insurance tax for earthquakes, I pay a GST on every single thing I purchase, I pay company tax, I pay dividend tax and I pay wages tax.” 

Faesenkloet said to stay at the forefront in business you have to reinvest continuously. 

“You’ve got to invest capital all the time. And particularly in our golf business … for example on our driving ranges we have radar technology … all these things cost money. We put in automatic ball loading machines, it was like $1 million per range to do that,” he said. 

“Even though we make good profit, to make that you’ve got to invest money.” 

Instead, Faesenkloet said he was “100% behind” Labour’s 28% capital gains tax. 

In a statement to the Herald, Swarbrick said its wealth tax applies only to the richest 0.3% of New Zealanders. 

“Someone with net wealth of $12 million on long run historical averages sees their assets inflate by half a million dollars a year in their sleep, without lifting a finger. 

“Under our proposal, they would be taxed on just a fraction of that, at $50,000, still adding multiples of the average person’s salary to their stockpile, while contributing fairly to their country, like we all do.” 

Swarbrick said the Green Party will ensure the very wealthy and the biggest corporations pay their fair share of tax. 

“This means 96% of New Zealanders get an income tax cut. 

“The wealth tax raises almost $3.8 billion in its first year, so we can cut income tax and fund the public services we all rely on. 

“We will not be held hostage while our country crumbles around us. The wealthiest New Zealanders can afford to pay their fair share, and there are a number who already back our plan to rebuild the country.”