A few simple facts. Labour will not govern this country before 2017 and there is a fairly good chance that they may not make it even then. David Cunliffe will never be Prime Minister of this country. I am happy to offer a wager of $1,000 David Cunliffe will not retake the leadership of the Labour following their decision making process in November. I spent much of the day yesterday cleaning out a septic tank with a shovel and wheelbarrow and its going to take the Labour party a lot longer than a day to get their tank back to a healthy state.
Craic, I will not take you up on this bet. Who knows, David Shearer may put his hat in the ring.
p.s. I am dismayed that you had to clean that tank out yourself, surely you had plenty of cash to get the guy in with a vacuum system?
FP, yes it's true that a CGT will tax the capital gain and any inflation on appropriate assets, but only at 15%. Maybe in the fine detail they'll remove an index for inflation like they take out costs, but the rate is certainly low to account for it.
Can't remember who suggested Labour get themselves better strategists. I think sitting back and being polite is out of the question now. They need to bombard the press and other media with facts and detail about where the country is headed under National, and remind the public that times have been better before. MVT hasn't provided the counter argument yet. There must be something?
David Cunliffe" buoyant economy"...says it all ...Having claimed that the economy was going to hell in a hand-cart, Cunliffe is now also claiming victory for Labour was impossible given the buoyant economy. He cannot have it both ways.
Stoploss, it's a common argument by the National Party and their bloggers to remind us all about power price increases in the mid 2000's. Your chart shows that power prices actually dropped in about 2000 and 2001, before rising by about 4-8% a year for the next few years after that. Well, that was out of Labour's hands, and in the marketplace. In 2002, the giant Maui field started ramping down sharply. Our cheap gas was at an end. I've attached a chart of the wholesale and retail gas prices for the period. For retail, prices more than doubled over a few years. There is a good markup on gas. Since Huntly power station used a lot of gas, it affected the price of the dearest power, that set the spot price and average prices as the market model required.
So unless you think Labour should have been able to create a new internationally large gas field at short notice, you can't blame them for that. National has been trying to put the blame on Labour for many years now. Now up to about 40-50 people reading this post, have no excuse for believing that lie.
FP, yes it's true that a CGT will tax the capital gain and any inflation on appropriate assets, but only at 15%. Maybe in the fine detail they'll remove an index for inflation like they take out costs, but the rate is certainly low to account for it.
It doesn't matter that it's only x%. If tax is levied only above inflation it's not worth worrying about. If it isn't then it should include the primary residence. If A buys a home and a batch, then replaces the batch with another he will be taxed. B buys a more expensive home then trades it - tax free. CGT is tricky, and without allowing repatriation is a bad tax.
It doesn't matter that it's only x%. If tax is levied only above inflation it's not worth worrying about. If it isn't then it should include the primary residence. If A buys a home and a batch, then replaces the batch with another he will be taxed. B buys a more expensive home then trades it - tax free. CGT is tricky, and without allowing repatriation is a bad tax.
FP, you are implying that there is no real capital gain on housing or investments above inflation. Is that correct?
In fact the first graph on this link shows that on average, NZ house prices corrected for inflation are still well above the breakeven point in most quarters. House prices are also strongly linked to net immigration numbers. By far the biggest average increase in housing costs appears to be a pure capital gain (not accounting for interest costs).
This means that when an investor rents out domestic or commercial property and covers most interest and maintenance costs (those costs also being tax deductible on investments), then the majority of the gain in the property value is not caused by inflation, it's at the moment a tax-free capital gain. All the investor needs to know is that immigration will continue, the population will increase, putting pressure on housing and commercial properties.
Since homeowners can't claim interest and maintenance costs, and don't get rental income from their home generally, any capital gain will be highly dubious. The bach, well up to them, the taxman can consider this a CGT asset, as a bach is often used to derive some income.
The latest major funding round from Callaghan Innovation has been notified. Some of the same firms feature each year, as they are on 2-3 year plans. Note that the main funded businesses add to just 110 throughout the country, and they have been granted nearly $300mill. Some comments down below are interesting. I know one of these businesses, they have struggled to make a profit for years. Investor cash goes in, it doesn't come back out.
I see tarn group made the list. Hope that's not her secret trust receiving donations to support Hubby's leadership bid. A little silly to use your nickname for what's supposed to be an anonymous account.
I see tarn group made the list. Hope that's not her secret trust receiving donations to support Hubby's leadership bid. A little silly to use your nickname for what's supposed to be an anonymous account.
Maybe she thought Tarn was a relatively common nickname.
The NZ Initiative sent me this helpful post, just when I was cooling down after the election loss. They are of course, National sycophants.
They say the grass is always greener on the other side; for New Zealanders looking to Australia, it often rings true. The sun seems to shine a bit brighter there, the pay packets are a bit fatter, and they have koalas.
But times are changing. The decline in long-term migration figures to Australia is just one example. And the reason is simple: Australia may have cuddly koalas, but New Zealand has John Key.
When I attended a conference in Sydney last week, I was struck by the Australians’ enthusiasm for anything New Zealand in general and our re-elected government in particular. What surprised them was John Key’s apparent ability to get the public on board with his “radical” reform agenda.
Radical? Really? At least on our side of the Tasman, Key hardly ever gets described in such ways. And indeed, at first glance, not a lot has changed since Key first took office. National has preserved traditional Labour policies such as state-funded education and health care, Working for Families tax credits, interest-free student loans and KiwiSaver. And as long as Key remains in office, superannuation reform is off the table.
But this seeming stability obscures some changes that are indeed quite radical. Increasing GST and reducing income tax was no small feat. Nor are charter schools, asset sales, loss of lifetime tenure for state houses, and increased obligations for beneficiaries. As the Sydney Morning Herald’s Peter Hartcher put it, John Key “has coaxed his country into swallowing the pills of reform yet entrusting him with power once again.”
So here’s the paradox: Key’s government looks reformist from a distance but his policies do not appear to be particularly bold when looked at in New Zealand. The question is, how does Key manage the kind of blink-and-you’ll-miss-it reforms, whilst implementing some truly substantial changes to New Zealand’s policy landscape?
The answer to this conundrum is that Key exemplifies the art of what one might call “radical incrementalism”.
Key has a good sense for the electorate’s appetite for change. The public has to be on board– and reforms take time, patience and good explanation.
That’s the real story other countries can take out of Key’s incremental radicalism. It’s not about tricking your patients into swallowing the pills, or promising false cures that won’t deliver results. It’s about educating the public on why these pills are necessary to build a strong, healthy economy.
And hopefully, in time, the electorate will start demanding the pills themselves, with the knowledge a thriving economy transforms lives and living standards.
It's the last line that really grates. 'Trickle down theory' is alive and well. It never works that way, but they can pretend it does. Those with the capital will make the real money. And as we all know, most of the time, the money is tax free.
Originally Posted by craic
Reply With Quote
Bookmarks