New NZ Gov't Regulation on Overseas Trading Accounts

[iceman]

SBQ do you think it is possible that you have become too obsessed about tax in NZ if you are bringing that up in an agressive manner (based on your description) at a neighbourhood gathering, as well as in most of your posts on here ?
Don´t take me wrong, I think it by and large has been an interesting discussion albeit a bit repetitive.

[SBQ]

SBQ do you think it is possible that you have become too obsessed about tax in NZ if you are bringing that up in an agressive manner (based on your description) at a neighbourhood gathering, as well as in most of your posts on here ?
Don´t take me wrong, I think it by and large has been an interesting discussion albeit a bit repetitive.

I do think people in NZ need to be more vocal about this tax disparity and make politicians right as they've done abroad. NZ has done a lot of great things and has showed the world in many examples. However, not in the area of investing. It's like the elephant in the room but no one is seeing it. We have all these discussions in this forum but with no tax consideration. Something so critical in the area of investment.. something so elementary, that you can talk about how so and so company did this or that in NZ or this person has made this much on this or that asset, yet.. none mention of their net after tax take. In another thread I mention the problem with EBITDA but that's a global accounting issue. It's more commonly used to deceive investors by reporting results in a certain way. Certainly not the way guru investors like Warren Buffet would consider.

Don't take my repetitive action as just. Warren Buffet himself has been openly aggressively at the investment industry, yet NOBODY seems to listen or care. What I see in the NZ investment industry is no different and when I lump in the tax disparity... whoa daddy, it makes investing worse, all because of a lack of talk about the issues that matter. As I put it to that financial advisor in the neighbourhood gathering, I told him he was culpable for working as an advisor by not expressing how unfair the system has become but instead, becoming part' of the problem. You can be sure no client that comes into his office will ask such critical questions.

Here is Buffet's rant at his annual meeting few years ago:
https://www.youtube.com/watch?v=xp9KUCel778

“Supposedly sophisticated people, generally richer people, hire consultants, and no consultant in the world is going to tell you ‘just buy an S&P index fund and sit for the next 50 years.’ You don’t get to be a consultant that way. And you certainly don’t get an annual fee that way. So the consultant has every motivation in the world to tell you, ‘this year I think we should concentrate more on international stocks,’ or ‘this manager is particularly good on the short side,’ and so they come in and they talk for hours, and you pay them a large fee, and they always suggest something other than just sitting on your rear end and participating in the American business without cost. And then those consultants, after they get their fees, they in turn recommend to you other people who charge fees, which… cumulatively eat up capital like crazy.”

“And the consultants always change their recommendations a little bit from year to year. They can’t change them 100% because then it would look like they didn’t know what they were doing the year before. So they tweak them from year to year and they come in and they have lots of charts and PowerPoint presentations and they recommend people who are in turn going to charge a lot of money and they say, ‘well you can only get the best talent by paying 2-and-20,’ or something of the sort, and the flow of money from the ‘hyperactive’ to what I call the ‘helpers’ is dramatic.”

Just as many financial advisors i've spoken to in NZ, they gladly would 'recommend' me a tax specialist because they make no comment on each individual's tax liability. How much do all the managed Kiwi Saver funds are paying to IRD in taxes? What % of their portfolio capital is eaten up by IRD's tax laws like FIF? When the investor that looks abroad like say in Canada, where savings/investment portfolios can grow 100% tax free and in some cases, can be withdrawn 100% tax free (ie education or disability savings and investments plans), why should they put keep putting their $ elsewhere than in NZ real estate?