New Zealand Celsias

An industry group is warning that changes to New Zealand’s commercial property tax regime will undermine efforts to reduce carbon emissions in the built environment.

The Government announced in the 2010 Budget it would not allow depreciation on commercial buildings, and also signalled that further changes would come. A review of the definition of a building structure and what is able to be classed as ‘fit-out’ is in the early stages.

New Zealand Green Building Council (NZGBC) board chair Dean Riddell says the Government should be allowing accelerated depreciation for capital expenditure on energy-efficient refurbishments to commercial buildings.

“Instead it is removing a strong incentive for the property industry to play its part towards becoming a low carbon economy.”

Riddell says tightening the rules on what businesses, building owners and developers are allowed to call fit-out and legally claim depreciation for was not in line with international efforts to ‘green’ the built environment.

“Items of fit-out, including air conditioning systems, lifts, escalators, partitions and electrical systems wear out over time, particularly in a commercial building that suffers much more wear and tear than a residential building.”

A NZGBC report in November last year found 17 percent of New Zealand’s total emissions could be attributed to the built environment. However, the report noted it was also one of the only sectors where reducing emissions actually saves money rather than costing the taxpayer.

Independent studies cited by the group suggest buildings certified by Green Building Councils can consume 85 percent less energy, 60 percent less potable water and send 69 percent less waste to landfill than non-certified buildings.

The NZGBC is an industry organisation with 420 member companies that aims to accelerate the development and adoption of green building practices.

Image: Flickr - Hans van Rijnberk