Capital Gains Tax

[iceman]

NZ is growing at a moderate rate, while Auckland is growing at a reasonably fast rate. Given population increases in other parts of the world, I'd say we're not really at a point where I'd call it a population explosion.

At the end of the day though, New Zealanders need to get used to apartment living if they want to live within or close to city centers. If they don't want to live in one, there's still plenty of land available throughout the country. People need to adapt.

Well said Zaphod. This is exactly what needs to happen. First home buyers should be looking at good quality, cheap to run apartments. Immigrants should have conditions placed on their Visa that they go to areas of NZ where their experience is needed. Like a medical doctor should go to Reefton if needed there, not Auckland to clog it up more . I just do not think like dibble in post 749 above and in fact think that attitude is the main reason for our silly house prices vs incomes.

[Bjauck]

Well said Zaphod. This is exactly what needs to happen. First home buyers should be looking at good quality, cheap to run apartments. ...
Often suggested by baby boomers who were able to buy stand alone houses with gardens to raise their children. And who remain happy for house price inflation to continue outstrip wage inflation?

[Entrep]

Often suggested by baby boomers who were able to buy stand alone houses with gardens to raise their children.

And/or those who are simply willing to work hard to get what they want

[Bjauck]

And/or those who are simply willing to work hard to get what they want Fair comment.

However I am not sure if you are suggesting that young of today should expect to work harder than the previous generation to be able to afford smaller and less private accommodation and be grateful they do not have to rent?

[Entrep]

Fair comment.

However I am not sure if you are suggesting that young of today should expect to work harder than the previous generation to be able to afford smaller and less private accommodation and be grateful they do not have to rent?

This is stating the obvious, but the world changes, the older generation had to deal with other things that young people today don't.

People can either start today and work towards a house or sit around complaining and hope that someone else makes things easier for them.

I guess my view is that you can sit around complaining or work on ways to achieve what you want yourself (like buying a cheap property out of Auckland, doing it up, renting it out, etc). Property is all about getting on the ladder (love it or hate it), that's the way it is in a popular country like NZ. That everyone should be entitled to get on the ladder in Auckland just isn't possible.

[Bjauck]

This is stating the obvious, but the world changes, the older generation had to deal with other things that young people today don't.

People can either start today and work towards a house or sit around complaining and hope that someone else makes things easier for them.

I guess my view is that you can sit around complaining or work on ways to achieve what you want yourself (like buying a cheap property out of Auckland, doing it up, renting it out, etc). Property is all about getting on the ladder (love it or hate it), that's the way it is in a popular country like NZ. That everyone should be entitled to get on the ladder in Auckland just isn't possible. Some generations do have it better than others - the generation that came after war, enjoyed socialised education and medicine, high owner-occupation rates and came before "user pays" and before the looming environmental crisis following unfettered consumption managed to hit a sweet spot?

True we do have to work with how things actually are - The existing tax and investment environment in NZ. However reform is always possible and one person's "complaining" is another person's seeking ways to reform and improve...

It does not mean that it was inevitable that NZ housing would be become so expensive for our income levels. It was never inevitable that investor housing would become the de facto pension scheme for so many - making it more difficult to get that toe-hold on "the owner-occupier ladder."

[iceman]

Often suggested by baby boomers who were able to buy stand alone houses with gardens to raise their children. And who remain happy for house price inflation to continue outstrip wage inflation?

Herald reports today (behind paywall) that NZ is in a townhouse and apartment building boom in Auckland as this has now become the favoured for young buyers.
This comment sums it up: "We've created a situation where people want to get into a new house or apartment and they don't want to have any maintenance and they want double glazing and insulation - they want the best of everything," he said.

So your baby boomer argument may be a bit off the mark. FYI, my first home was in an apartment building some 35 years ago and it worked well for me back then.

[artemis]

There may be a boom, but until there are crews on the ground it is just a boom in approvals. I do think terrace and townhouse developments will do OK, but large apartment developments not so much. The latter provide mostly small less expensive places, especially as rentals, but will be cancelled if too difficult to sell off the plans.

Couple of years back Colliers reported that 49 consented apartment developments in Auckland were cancelled, for various reasons.

[Bjauck]

Herald reports today (behind paywall) that NZ is in a townhouse and apartment building boom in Auckland as this has now become the favoured for young buyers.
This comment sums it up: "We've created a situation where people want to get into a new house or apartment and they don't want to have any maintenance and they want double glazing and insulation - they want the best of everything," he said.

So your baby boomer argument may be a bit off the mark. FYI, my first home was in an apartment building some 35 years ago and it worked well for me back then.

Getting a toe-hold for a first home buyer in the lowest quartile of the Auckland housing market would probably see little left over for renovation or maintenance? Plus with both people in a couple working long hours, just how much time would there be for work around the house? Especially with wood burners being phased out owing to trying to preserve the ravaged environment, surely double glazing and insulation are basic necessities? Also the average age of the first home buyer has been creeping up as the deposit needed increases at a rate faster than the increase in incomes.

I don't see how it negates my boomer point.

[iceman]

It is difficult for FHB to get their deposit together but servicing the mortgage is not that hard and certainly no more difficult than in the past.
This is copied from an article written by Ashley Church on One Roof on 29 August this year:
“There’s the fact that it actually costs less to service a mortgage, today, than it did in the mid-80s when the cost reached an eye-watering 52 percent of average household income – the highest level it has reached in the modern era. Today it sits at around 37 percent of the average household income despite the fact that median house prices have increased dramatically, which means that there is still significant capacity to service additional house price growth within the average household budget.”

[Bjauck]

It is difficult for FHB to get their deposit together but servicing the mortgage is not that hard and certainly no more difficult than in the past.
This is copied from an article written by Ashley Church on One Roof on 29 August this year:
“There’s the fact that it actually costs less to service a mortgage, today, than it did in the mid-80s when the cost reached an eye-watering 52 percent of average household income – the highest level it has reached in the modern era. Today it sits at around 37 percent of the average household income despite the fact that median house prices have increased dramatically, which means that there is still significant capacity to service additional house price growth within the average household budget.”
True, although raising the deposit is expensive, It is getting more affordable to service a mortgage especially with interest rates dropping like a stone. However job security for younger people especially is less certain as the Covid protections are lifted? I guess in its own way the government is shifting wealth from (older) deposit-holders to (younger) borrowers and (wealthier and older) real estate owners.

[fungus pudding]

True, although raising the deposit is expensive, It is getting more affordable to service a mortgage especially with interest rates dropping like a stone. However job security for younger people especially is less certain as the Covid protections are lifted? I guess in its own way the government is shifting wealth from (older) deposit-holders to (younger) borrowers and (wealthier and older) real estate owners.

It's the falling interest rates that push up real estate prices. Far better to buy while interest rates are sky-high.

[nztx]

Is the Green's "Wealth Tax" announced by Shaw not just another swipe at a variant of this sort of taxing ?

Probably equally unworkable as well .. ;)

[fungus pudding]

Is the Green's "Wealth Tax" announced by Shaw not just another swipe at a variant of this sort of taxing ?

Probably equally unworkable as well .. ;)

Yes it is another swipe at a tax, but even more unworkable. Envisage an army of govt. inspectors, accompanied by art appraisers, antique valuers, real estate valuers, investment consultants and a car dealer arriving on your doorstep once a year to complete the annual valuation.

[winner69]

Poll choice - Goff is just an idiot

Suppose nearly 10 years on that’s still a good choice

[Bjauck]

Yes it is another swipe at a tax, but even more unworkable. Envisage an army of govt. inspectors, accompanied by art appraisers, antique valuers, real estate valuers, investment consultants and a car dealer arriving on your doorstep once a year to complete the annual valuation. Taxed on your income from personal effort....and all you want to do is try to feed your family and get some shelter.Yet the government grabs a chunk before you see it! Who would come up with such a scheme? After all the basic costs of food, shelter and clothing are necessary for my being able to present myself to earn the wage. Why be taxed on what it costs me to be able to work in the first place?

Yet the wealthy person can accumulate art and sell it for thousands more and all tax free...what a crazy world eh?

Would there be a threshold? Wouldnt art be valued for insurance and buildings only need to be valued every now and again (as with rates valuations) unless objected too?

It would be better to have a cgt than a wealth tax I agree, but look at the block from vested interests in that front too.

[BlackPeter]

Yes it is another swipe at a tax, but even more unworkable. Envisage an army of govt. inspectors, accompanied by art appraisers, antique valuers, real estate valuers, investment consultants and a car dealer arriving on your doorstep once a year to complete the annual valuation.

Actually - its not that difficult. Anything below 50k is not considered, and most of the bigger ticket items are valued anyway.

Real estate: For anything property related we have a GV, no additional work / valuation required.

Cars: If I believe TRA, than ways above 95% of all cars must be worth less than 50K ... i.e. no valuation required. I am sure the reminder (creme of the creme) is insured, i.e. just take the insurance value. No additional work at all.

Antiques / Art ... again - it would be quite easy to just take the agreed insurance value. I doubt there is much stuff above 50k around which is not insured. No additional work required.

Companies ... might be an issues, but than - why not go for the NTA in the balance sheet they need to file anyway. No additional work required.

While more taxes are clearly never popular - and the geese who might get plugged are already intensely hissing .... the country clearly needs a wider tax base to pay for superannuation and health for an aging population, for improved infrastructure and for educating the generation (our grandchildren) who needs to pay anyway the lions share of our super, health and the accumulated Covid cost.

The Rich are getting richer in NZ as well as everywhere, while the poor are getting poorer. A wealth tax would hit the people who benefited most from the recent crisis. I think this sounds fair enough.

[fungus pudding]

Actually - its not that difficult. Anything below 50k is not considered, and most of the bigger ticket items are valued anyway.

Real estate: For anything property related we have a GV, no additional work / valuation required.

Cars: If I believe TRA, than ways above 95% of all cars must be worth less than 50K ... i.e. no valuation required. I am sure the reminder (creme of the creme) is insured, i.e. just take the insurance value. No additional work at all.

Antiques / Art ... again - it would be quite easy to just take the agreed insurance value. I doubt there is much stuff above 50k around which is not insured. No additional work required.

Companies ... might be an issues, but than - why not go for the NTA in the balance sheet they need to file anyway. No additional work required.

While more taxes are clearly never popular - and the geese who might get plugged are already intensely hissing .... the country clearly needs a wider tax base to pay for superannuation and health for an aging population, for improved infrastructure and for educating the generation (our grandchildren) who needs to pay anyway the lions share of our super, health and the accumulated Covid cost.

The Rich are getting richer in NZ as well as everywhere, while the poor are getting poorer. A wealth tax would hit the people who benefited most from the recent crisis. I think this sounds fair enough.

I don't. The big problem is those who are asset rich - cash poor, which describes a huge percentage of retirees in our bigger cities. I know it can be deferred -- which makes it simply a return to the death taxes we used to have and dumped in the early 90s. The thing that follows would obviously be a return to gift duties, or it won't work. Both death duties and gift duties were horrible taxes. I'm sure you recall the dodgy nonsense that went with those taxes. No doubt you also recall the legitimate gifting programs used to avoid death duties. They would re-emerge on day one.
As far as limits on asset values go (individual items at 50k and the proposed total of 1 million), the levels applied on introduction of a wealth tax can be altered at the drop of a hat. Naturally they will be kept low to introduce such a scheme - but a future govt. only requires the stroke of a pen to change it.
Not many countries have such with wealth taxes and the associated gift and death duties, mainly because they are an administrative nightmare.

[Bjauck]

…Both death duties and gift duties were horrible taxes. …and GST and income taxes are worse than both of them.

[fungus pudding]

…and GST and income taxes are worse than both of them.

Couldn't agree less. We have to have some sort of tax or taxes. NZ GST system is extremely effective and easy to administer. Income tax is a necessary evil, and although we all have different views on the rates and progressions, it's relatively simple to apply and administer.

[Bjauck]

Couldn't agree less. We have to have some sort of tax or taxes. NZ GST system is extremely effective and easy to administer. Income tax is a necessary evil, and although we all have different views on the rates and progressions, it's relatively simple to apply and administer. I am not sure that income tax is particular easy to apply and administer as the court cases, accountants fees and laws as to what constitutes income, dividends, profits etc attest to.

Why couldn’t capital transfer taxes (death and gift) be the necessary evil? We have to agree to differ on this.

People are taxed twice before they just obtain the necessities for life - first by way of PAYE deducted from wages and then by way of GST on food and goods. It is highly regressive. Forget about a flat tax - the NZ system has a regressive system with those with the most gains (both capital and income) ending up paying the smallest percentage in tax.

[BlackPeter]

I don't. The big problem is those who are asset rich - cash poor, which describes a huge percentage of retirees in our bigger cities. I know it can be deferred -- which makes it simply a return to the death taxes we used to have and dumped in the early 90s. The thing that follows would obviously be a return to gift duties, or it won't work. Both death duties and gift duties were horrible taxes. I'm sure you recall the dodgy nonsense that went with those taxes. No doubt you also recall the legitimate gifting programs used to avoid death duties. They would re-emerge on day one.
As far as limits on asset values go (individual items at 50k and the proposed total of 1 million), the levels applied on introduction of a wealth tax can be altered at the drop of a hat. Naturally they will be kept low to introduce such a scheme - but a future govt. only requires the stroke of a pen to change it.
Not many countries have such with wealth taxes and the associated gift and death duties, mainly because they are an administrative nightmare.

Nothing wrong with having different views and a good discussion on taxes.

What is a given is that we will need to increase the tax base over the coming decades ... as indicated health costs, super costs, costs to deal with climate change (either try to stem it or alternatively pay for the damage) all will go up. Substantially.

Good on the Greens for being the only party which at least made a proposal how to broaden the tax base ... basically all other parties pretend there is no problem. I am sure there are other ways to solve this problem, but putting the head into the sand will not cut it.

If you don't like the wealth tax - which other taxes would you like to see introduced or increased instead?

[artemis]

A GST increase captures the black and grey economies so produces more revenue than projections based on the legit books.

There is also the option to reduce expenditure. Management mantra - there is 30% waste in every process. I have certainly worked in and alongside jobs just like that. And that's not counting the useless or failed projects and initiatives.

[fungus pudding]

Nothing wrong with having different views and a good discussion on taxes.

What is a given is that we will need to increase the tax base over the coming decades ... as indicated health costs, super costs, costs to deal with climate change (either try to stem it or alternatively pay for the damage) all will go up. Substantially.

Good on the Greens for being the only party which at least made a proposal how to broaden the tax base ... basically all other parties pretend there is no problem. I am sure there are other ways to solve this problem, but putting the head into the sand will not cut it.

If you don't like the wealth tax - which other taxes would you like to see introduced or increased instead?

Study up Laffer economics, specifically the Laffer curve, and you'll find it's indisputable there are two levels of tax, one high and one low, that will produce the same result. In simple terms lowering the tax rate can often produce as much or more revenue than raising it. If too low obviously it will not provide sufficient revenue to run Govt; but if too high it won't either because of disincentives, driving transactions to the black market, under the counter trading etc, or worse still - lack of trading. The trick is to find and apply the lowest effective rate.

[Bjauck]

Study up Laffer economics, specifically the Laffer curve, and you'll find it's indisputable there are two levels of tax, one high and one low, that will produce the same result. In simple terms lowering the tax rate can often produce as much or more revenue than raising it. If too low obviously it will not provide sufficient revenue to run Govt; but if too high it won't either because of disincentives, driving transactions to the black market, under the counter trading etc, or worse still - lack of trading. The trick is to find and apply the lowest effective rate. There may be some truth with extreme tax and the “Laffer” curve but it depends on other factors and NZ is a long way off from prohibitive tax on the wealthy.....

However I can see why some would latch onto narratives such as Laffer and trickle-down...

https://qz.com/895785/laffer-curve-everything-trump-and-republicans-get-wrong-about-trickle-down-economics-and-reaganomics/

Almost everything Republicans get wrong about the economy started with a cocktail napkin in 1974

[fungus pudding]

There may be some truth with extreme tax and the “Laffer” curve but it depends on other factors and NZ is a long way off from prohibitive tax on the wealthy.....

However I can see why some would latch onto narratives such as Laffer and trickle-down...

https://qz.com/895785/laffer-curve-everything-trump-and-republicans-get-wrong-about-trickle-down-economics-and-reaganomics/

Almost everything Republicans get wrong about the economy started with a cocktail napkin in 1974

You may consider Labours' proposed marginal tax of 39% above 180k is not excessive. I do think it is, and it will certainly require a bit of 'restructuring'. Think back to the shenanigans when Muldoon struck top margin at 66% (pre GST)

[dibble]

Study up Laffer economics, specifically the Laffer curve, and you'll find it's indisputable there are two levels of tax, one high and one low, that will produce the same result. In simple terms lowering the tax rate can often produce as much or more revenue than raising it. If too low obviously it will not provide sufficient revenue to run Govt; but if too high it won't either because of disincentives, driving transactions to the black market, under the counter trading etc, or worse still - lack of trading. The trick is to find and apply the lowest effective rate.

Laffer made up his curve in a bar. There is no conclusion on what point between the two extremes is best. His wisest moment is noting lower tax MUST be linked to increased productivity otherwise any drop in tax is pointless. There is scant evidence to prove giving tax breaks to the wealthy achieves commensurate productivity gains (net of inflation) let alone achieves an overall net benefit to society. Indeed skeptics might suggest is the whole Laffer thing is merely something to cling to to get your lobbyist buddies tax breaks. Look at the logic, do people suddenly work more when tax drops? Do they even have the option to do that? Did everyone you know go out and work harder when National dropped rates to 33%?

[Aaron]

Study up Laffer economics, specifically the Laffer curve, and you'll find it's indisputable there are two levels of tax, one high and one low, that will produce the same result. In simple terms lowering the tax rate can often produce as much or more revenue than raising it. If too low obviously it will not provide sufficient revenue to run Govt; but if too high it won't either because of disincentives, driving transactions to the black market, under the counter trading etc, or worse still - lack of trading. The trick is to find and apply the lowest effective rate.

You can see some interviews with Arthur Laffer on you tube. Have a watch and you can can make your own conclusions as to what sort of person he is and whether his views are pragmatic or ideologically driven. No surprise his ideas appeal to FP though.

[fungus pudding]

You can see some interviews with Arthur Laffer on you tube. Have a watch and you can can make your own conclusions as to what sort of person he is and whether his views are pragmatic or ideologically driven. No surprise his ideas appeal to FP though.

I am simply saying it's impossible to argue with the conclusion of the curve. Consider an increase in income tax rates to 99%. Result - no income for govt. because the economy would be driven to underground, or barter. At 1% - nobody would avoid either earning or declaring it. Absurd examples, but that does emphasize the logic. You are correct - logic does feature in my reasoning.

[Aaron]

I am simply saying it's impossible to argue with the conclusion of the curve. Consider an increase in income tax rates to 99%. Result - no income for govt. because the economy would be driven to underground, or barter. At 1% - nobody would avoid either earning or declaring it. Absurd examples, but that does emphasize the logic. You are correct - logic does feature in my reasoning.

Thanks, absurd examples make it much more understandable. Very simplistic. Much like a flat income tax rate.

[Bjauck]

I am simply saying it's impossible to argue with the conclusion of the curve. Consider an increase in income tax rates to 99%. Result - no income for govt. because the economy would be driven to underground, or barter. At 1% - nobody would avoid either earning or declaring it. Absurd examples, but that does emphasize the logic. You are correct - logic does feature in my reasoning.

An additional point to consider for NZ conditions is that unlike the USA, NZ does not have a CGT. So the NZ version of the "Laffer Curve" always has a leaky valve to those investments that rely on capital gains for most of its return.

So tax cuts for the wealthier will tend to lead usually to increased investment, not into taxable income producing investment but mostly into investment producing tax-free capital gains.

Any total tax return effectiveness, if there is one, from the Laffer theory is significantly reduced in the NZ tax environment?

[westerly]

A GST increase captures the black and grey economies so produces more revenue than projections based on the legit books.

There is also the option to reduce expenditure. Management mantra - there is 30% waste in every process. I have certainly worked in and alongside jobs just like that. And that's not counting the useless or failed projects and initiatives.

National tried reducing expenditure resulting in Labour inheriting many problems that should never have occurred.
GST increases may capture the black economy but has more effect on the lower paid.
A return to death duties would be one way to increase revenue and despite FP’ s abhorrence would be a good substitute for CGT.
The Nordic system of open tax paid availability would be interesting if introduced. Reputedly many wealthy people in NZ pay no tax at all which may be legitimate, but would certainly raise a few eyebrows if there names were freely available.

westerly

[fungus pudding]

National tried reducing expenditure resulting in Labour inheriting many problems that should never have occurred.
GST increases may capture the black economy but has more effect on the lower paid.
A return to death duties would be one way to increase revenue and despite FP’ s abhorrence would be a good substitute for CGT.
The Nordic system of open tax paid availability would be interesting if introduced. Reputedly many wealthy people in NZ pay no tax at all which may be legitimate, but would certainly raise a few eyebrows if there names were freely available.

westerly

Perhaps you'd like to enlighten us on their* names. Or even better - their* methods. You can't of course-don't believe everything you hear; especially from your envious mates who moan and grizzle rather than going and earning a buck.

* N.B. correct spelling.

[iceman]

National tried reducing expenditure resulting in Labour inheriting many problems that should never have occurred.
GST increases may capture the black economy but has more effect on the lower paid.
A return to death duties would be one way to increase revenue and despite FP’ s abhorrence would be a good substitute for CGT.
The Nordic system of open tax paid availability would be interesting if introduced. Reputedly many wealthy people in NZ pay no tax at all which may be legitimate, but would certainly raise a few eyebrows if there names were freely available.

westerly

The comparison between NZ and Nordic countries is an interesting one. I put it to you that the big difference is the large proportion of people in NZ that either do not want to work or are unemployable. Until we fix that, any dream of a Nordic type social system is just that, a dream. A CGT or a wealth tax will not fix it. We need to fix attitudes first.

[Balance]

The comparison between NZ and Nordic countries is an interesting one. I put it to you that the big difference is the large proportion of people in NZ that either do not want to work or are unemployable. Until we fix that, any dream of a Nordic type social system is just that, a dream. A CGT or a wealth tax will not fix it. We need to fix attitudes first.

NZ's productive sector is screaming out for workers.

Despite tens of thousands on social welfare (thanks to Cindy's breeding beneficiaries' policies), the productive sector, especially the horticultural sector, faces disaster because of lack of workers.

[Bjauck]

The comparison between NZ and Nordic countries is an interesting one. I put it to you that the big difference is the large proportion of people in NZ that either do not want to work or are unemployable. Until we fix that, any dream of a Nordic type social system is just that, a dream. A CGT or a wealth tax will not fix it. We need to fix attitudes first. What if part of the solution "to fix attitudes" is to broaden the tax base to include those taxes (and maybe others you also dislike?) to encourage investment into taxable income producing and employment stimulating areas. You have already excluded that part of any solution?

Have you got links to the studies that conclude that NZ has higher proportion of people who do not wish to work or are "unemployable" compared with the various Nordic countries?

However I agree. NZ does need to look at the appropriate and relevant education and vocational training, underlying socio-economic causes, underlying taxation issues and other systemic issues behind any non-engagement in NZ society. It would be great to have actual policies that address these issues head-on instead of their coming to grief against the powerful block of vested interests?

[Bjauck]

NZ's productive sector is screaming out for workers.

Despite tens of thousands on social welfare (thanks to Cindy's breeding beneficiaries' policies), the productive sector, especially the horticultural sector, faces disaster because of lack of workers. Is this related to CGT?
Instead of relying on low pay and poor conditions that only workers from poor countries are prepared to put up with, Maybe pay more and improve conditions to attract more NZers?

[Balance]

Is this related to CGT?
Instead of relying on low pay and poor conditions that only workers from poor countries are prepared to put up with, Maybe pay more and improve conditions to attract more NZers?

Or reduce welfare payments and get people to actually work?

[fungus pudding]

Instead of relying on low pay and poor conditions that only workers from poor countries are prepared to put up with, Maybe pay more and improve conditions to attract more NZers?

And import more from countries that pay lower wages? Does that really make sense - or is it easier said than done? Remember, it's the consumer that ultimately dictates what the employer can pay.

Every increase in the minimum rate risks sending jobs overseas.

[Bjauck]

And import more from countries that pay lower wages? Does that really make sense If they have a comparative advantage in producing a particular product, yes it makes sense. If kiwifruit for example can be grown and harvested more efficiently overseas then it is a win-win for NZ consumers and the country concerned. NZ then could concentrate on industries and products for which it has a comparative advantage.


Every increase in the minimum rate risks sending jobs overseas. (Satire) So globalism was really about a race to the bottom for workers conditions and wage rates after all? All so those nasty capitalists could import desperate and poor labourers from desperate post-colonial countries and then enjoy their capital gains off the backs of downtrodden workers and inherit daddy's wealth tax free. (/satire) I tried to make it relevant to CGT.

[iceman]

What if part of the solution "to fix attitudes" is to broaden the tax base to include those taxes (and maybe others you also dislike?) to encourage investment into taxable income producing and employment stimulating areas. You have already excluded that part of any solution?

Have you got links to the studies that conclude that NZ has higher proportion of people who do not wish to work or are "unemployable" compared with the various Nordic countries?

However I agree. NZ does need to look at the appropriate and relevant education and vocational training, underlying socio-economic causes, underlying taxation issues and other systemic issues behind any non-engagement in NZ society. It would be great to have actual policies that address these issues head-on instead of their coming to grief against the powerful block of vested interests?

Bjauck you are making huge assumptions about my position on taxes. I am all for fair taxes to maintain a good and FAIR social system.

But in response to your question, no I do not have any links to "studies" on differences between Nordic countries and NZ. I have interests in both a Nordic country and in NZ and trust myself to see the difference, I don't need studies to tell me about it. And the typical Leftie response is that we need to increase wages to get people to work. While that is partly true because our benefits are very high and not much incentive to work, it is not true that the jobs available are all low paying. In my industry (fishing), we can no longer crew vessels with reliable good Kiwi workers. An 18 yo unqualified but hard worker, could get a job in our industry tomorrow if they'd want to go away for 6 weeks at a time. 6 weeks on and 6 weeks off and earn $35-50k a year for 6 months work. But no, going away for a weekend is beyond what they're prepared to do.
Agriculture and horticulture is in the same situation.
I've just come from a couple of weeks trip around the bottom of the South Island. I made a point of talking to pub, hotel and tourism business owners along the way. They are ALL complaining about the lack of reliable workers available and some were working much longer hours than they wanted themselves, because they can not get workers.

So I'm sorry to hear you need some studies to prove this to you. Open your eyes and have a look for yourself. The situation in NZ today is outrageous. Stop making excuses for it.

[Bjauck]

..

So I'm sorry to hear you need some studies to prove this to you. Open your eyes and have a look for yourself. The situation in NZ today is outrageous. Stop making excuses for it.
You had seemed to dismiss certain taxes from the outset. My apologies for getting that wrong.

Individual Personal experience is great and is necessary to stimulate discussion. It does however need independent and careful corroboration.

I guess we may have different preconceptions as to where the blame for various shortcomings in NZ lie. I guess the response to Coronavirus brings these differences to the forefront. I think both you and I do try to look for the real causes and not to rely on excuses for the sake of an easy time.

I do try to keep eyes open, but concede you sound like you have greater real life experience.

[westerly]

Perhaps you'd like to enlighten us on their* names. Or even better - their* methods. You can't of course-don't believe everything you hear; especially from your envious mates who moan and grizzle rather than going and earning a buck.

* N.B. correct spelling.

Tax records are private but to enlighten you on their methods this link makes interesting reading,
https://www.theguardian.com/world/2020/aug/31/new-zealands-astounding-wealth-gap-challenges-our-fair-go-identity especially the link to IRD research
wage earners can't avoid tax ,PAYE takes care of that.

westerly

[fungus pudding]

Tax records are private but to enlighten you on their methods this link makes interesting reading,
https://www.theguardian.com/world/2020/aug/31/new-zealands-astounding-wealth-gap-challenges-our-fair-go-identity especially the link to IRD research
wage earners can't avoid tax ,PAYE takes care of that.

westerly

That does not explain how to use a trust to avoid tax.

[westerly]

That does not explain how to use a trust to avoid tax.

I would rather talk to my envious mates. They are not thick.:)

westerly

[fungus pudding]

I would rather talk to my envious mates. They are not thick.:)

westerly
You can all sit around scheming up how to 'redistribute' someone else's goodies.

[artemis]

You can all sit around scheming up how to 'redistribute' someone else's goodies.

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas Sowell.

Comments?

[Bjauck]

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas Sowell.

Comments?

Fairness and social justice is nothing new. For the Commonwealth, The Magna Carta in 1215 is a classic example.

Anyway was it fair profit/payment for the person's work?

[fungus pudding]

Fairness and social justice is nothing new. For the Commonwealth, The Magna Carta in 1215 is a classic example.

Anyway was it fair profit/payment for the person's work?

The willing buyer - willing seller concept will determine that.

[Bjauck]

The willing buyer - willing seller concept will determine that.....and the laws of the land. Those laws include taxes so I guess what is fair in NZ is whatever the Queen-in-parliament resolves as law?

[fungus pudding]

....and the laws of the land. Those laws include taxes so I guess what is fair in NZ is whatever the Queen-in-parliament resolves as law?

Just because something is law does not make it fair.

[Bjauck]

Just because something is law does not make it fair.
So a willing seller of stolen goods who found a willing buyer should be entitled to keep his “income”? Perhaps “some” laws are fair?

[fungus pudding]

So a willing seller of stolen goods who found a willing buyer should be entitled to keep his “income”? Perhaps “some” laws are fair?

Of course some laws are fair. However your illogical statement 'I guess what is fair in NZ is whatever the Queen-in-parliament resolves as law' is not necessarily the case.

[Bjauck]

Of course some laws are fair. However your illogical statement 'I guess what is fair in NZ is whatever the Queen-in-parliament resolves as law' is not necessarily the case. So every individual can have their own interpretation of what is fair?

[zacman]

So every individual can have their own interpretation of what is fair?

But of course. We are all allowed an opinion. However, irrespective on whether or not I think a law is fair, I must still adhere to it. I may think that it is unfair that large parts of Central Auckland have a speed limit of 30km/hr, but tough, I must follow the law.

zacman

[Bjauck]

But of course. We are all allowed an opinion. However, irrespective on whether or not I think a law is fair, I must still adhere to it. I may think that it is unfair that large parts of Central Auckland have a speed limit of 30km/hr, but tough, I must follow the law.

zacman So going back to Artemis's discussion point - what "your 'fair share' of what someone else has worked for" depends on what you feel is a fair income, taking into account what you think are fair laws, fair share of local and national infrastructure, expenses, security, and fair health, social and environmental responsibilities.

A democratic society probably has a legal framework that approximately hits the "mid-point" of the spread of opinions on what is fair.

[Baa_Baa]

So going back to Artemis's discussion point - what "your 'fair share' of what someone else has worked for" depends on what you feel is a fair income, taking into account what you think are fair laws, fair share of local and national infrastructure, expenses, security, and fair health, social and environmental responsibilities.

A democratic society probably has a legal framework that approximately hits the "mid-point" of the spread of opinions on what is fair.

You think it’s unfair if one earns an high salary and fair if they don’t, so the ones who do earn high wages should support the ones who don’t? And you address this imbalance through tax.

Is that a summary of what you think?

[moka]

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas Sowell.

Comments?It is the wrong question, or it has the wrong or too narrow a focus. Social justice includes much more than is what your fair share of what someone else has worked for. Implicit in that question is that others are not entitled to any or much of what someone else has worked for. The question is also about an individual and we are all part of society whether we are in paid work or not, with obligations and responsibilities to each other. The question is about capitalism and ignores the social aspects.

The questions we ask need to include words like social justice, social welfare, social wealth, social labour, social inequality, social media, social movements, social discontent, social security, social services, social value, society, socialism. Yes, even that much maligned and discredited word socialism. And not in the sense of either socialism or capitalism, but an acknowledgment that we have a system or society that includes the characteristics of both socialism and capitalism.

[nztx]

You may consider Labours' proposed marginal tax of 39% above 180k is not excessive. I do think it is, and it will certainly require a bit of 'restructuring'. Think back to the shenanigans when Muldoon struck top margin at 66% (pre GST)

I remember the final part of that era well .. Excess Retention Tax, all manner of weird & wonderful Loss making Partnerships

Now we have Company Imputation Taxes passing through Company Tax credits to stakeholders

[nztx]

Why do we need further Wealth Transferring Taxes anyway ?

Think everyone's Super & Kiwisaver funds may well also be caught by mutations of this, in the same way as failed CGT hoped
to capture it's target & kneecap everyone from all walks in process

What of initiatives to simplify Tax processes ?

Have these been thrown out with the trash due Politician's excessive spending / wasteful initiatives - in their soul digging to find a convenient target audience to inflict to try to fill the coffers for the wasted billions under their terms ?

What will this potentially do to the country's productivity / retirement planning / people's savings investing habits ?

It is no secret that there is a small bunch of high / middle earners shelling out a sizeable portion of "Net Taxes" at one end
and a vast raft at the lower end, all in the "Net Tax Refund / receiving Tax Credits spectrum throwing in top ups, W4F etc

Seeing this sort of collect from one & seeing where it gets disbursed & the vast extent of 'subsidy' to another sector never ceases to amaze year in year out, with ever increasing levels for the net tax refund / credit group

The drag on the economy at lower end of the spectrum increases every time gleeful politicians pursuing their self serving
goals elect to ramp up W4F etc etc

Should the Lower Spectrum on the receiving end not be more productive to justify the vast pool of 'Net Tax Refunds/Credits' they pocket each year ?

[Bjauck]

You think it’s unfair if one earns an high salary and fair if they don’t, so the ones who do earn high wages should support the ones who don’t? And you address this imbalance through tax.

Is that a summary of what you think?

No. However if there is a debate about what is fair to deduct by way of tax from someone's income or other gains then there is an equally valid discussion about what constitutes fair income or gains in the first place.

For example if you think teachers are underpaid then you are more likely to think it is "unfair" to deduct as much tax from them as someone else who has the same income.

Also you may think it unfair if someone's income from their business does not fully account for the costs (for example) on the environment and for which the current government does not insist on compensation. In other words you may think it unfair that some of the true costs of an activity are socialised, whereas the exaggerated profits are privatised.

[artemis]

A further context is '2 workers for every 1 beneficiary'. Some interesting discussion and official numbers by Lindsay Mitchell at the below link, noting that the beneficiary number includes those on super. If the impost on workers continues to rise we should not be surprised if some of those workers make economic adjustments.

As they say - time is the new money.

https://lindsaymitchell.blogspot.com/2020/10/2-workers-for-every-1-beneficiary.html

[Bjauck]

A further context is '2 workers for every 1 beneficiary'. Some interesting discussion and official numbers by Lindsay Mitchell at the below link, noting that the beneficiary number includes those on super. If the impost on workers continues to rise we should not be surprised if some of those workers make economic adjustments.

As they say - time is the new money.

https://lindsaymitchell.blogspot.com/2020/10/2-workers-for-every-1-beneficiary.html

So definitely time to tax capital gains as other countries in the OECD do. If the impost on workers' incomes rises but capital gains generally remain untaxed, then the economic change taxpayers will try to do will be to structure their affairs to enable more untaxed capital gains, further burdening those who earn taxable incomes?

[artemis]

So definitely time to tax capital gains as other countries in the OECD do. If the impost on workers' incomes rises but capital gains generally remain untaxed, then the economic change taxpayers will try to do will be to structure their affairs to enable more untaxed capital gains, further burdening those who earn taxable incomes?

It is not either / or. And appears unlikely there will be a capital gains or wealth tax for at least the next 3 years. Yet as a smaller economy and higher debt $$ need to come from either increased revenue or reduced spending or of course both.

For example -
- productivity increase - probably means increased automation, fewer jobs in those sectors.
- spend less tax / rates revenue - some stupid expenditure out there that should be examined. And canned.
- new industries supported but limited support so sink or swim.
- less regulation unless supported by rigorous benefit cost analysis and post implementation reviews with consequences if results are nothing like projections.

[Bjauck]

It is not either / or. And appears unlikely there will be a capital gains or wealth tax for at least the next 3 years. Yet as a smaller economy and higher debt $$ need to come from either increased revenue or reduced spending or of course both.

For example -
- productivity increase - probably means increased automation, fewer jobs in those sectors.
- spend less tax / rates revenue - some stupid expenditure out there that should be examined. And canned.
- new industries supported but limited support so sink or swim.
- less regulation unless supported by rigorous benefit cost analysis and post implementation reviews with consequences if results are nothing like projections. Of course there will be no CGT as vested interests have blocked that. So it looks like investment continues to favour Real estate (see the latest REINZ figures) and not into productivity improving business investment. So NZ will have to continue to rely on immigration and not productivity improvements for any GNP growth. And increased tax revenue to pay for covid will have to be squeezed out of workers, income earners and GST...

[Sir Ten]

Has anyone else wondered whether the only way to deal with the "housing crisis" is to wait 30 odd years? And even if that helps, Gen X'ers and Millenials are largely screwed?

- Those that own a large proportion of the houses are, let's say, 50 years or older (yep, it's an assumption, that I haven't had time to find supporting information for... yet... but if I'm onto something, I do have 30 odd years)
- In 1996, only 23% of the population were 50+. As of 2018, it was closer to 32%.
- When the boomers start pushing up daisies there should be an increased level of supply
- In the meantime, a large proportion of Gen X'ers and Millenials probably need to come to the realisation that home ownership is not going to be the norm for their generations. Their job is to stop procreating - which has been helped by slow wage growth relative to house price growth - i.e. large families (say, 5+) are unaffordable
- Therefore, in 30 years time we have less people, more houses and prices go down

I know it's very simplistic and that the government can and will tweak around the edges but, as we've seen, all governments (regardless of colour) have struggled to make much of an impact.

The variable in there that needs some attention is wage growth. And by wage growth I mean, productivity driven wage growth, not wage growth driven by government intervention (minimum wages) which just leads to price increases and inflation. At the moment, it seems like our pollies are throwing darts at the board with things like fees-free university, etc.

Hard not to feel sorry for millenials. I reckon many of them are pretty f*cked. Doesn't help that they're been encouraged to behave in ways that don't necessarily foster much self-responsibility... and did I mention robots. Robots are coming for them and their jobs too.

[artemis]

....
I know it's very simplistic and that the government can and will tweak around the edges but, as we've seen, all governments (regardless of colour) have struggled to make much of an impact.....

There is an even simpler solution, if there is a housing crisis at all. It is ECON101 - supply and demand. Not much ordinary folk can do about demand, but certainly can do something about supply.

But first governments, central and local, need to step out of the way. Sort the RMA, sort the rural urban boundary, sort consents process and costs, stop interfering in the rental market more than with other businesses.

Realistically there are going to be some limits, but need be nowhere near as many as there are now. But if people in the supply chain can make a decent buck from building, they will. And if cheap, people will buy or rent. Might mean cookie cutter or imports in containers from China. Might mean permanent trailer parks.

Might be like an idea Rodney Hide wrote about a few months ago, a small trial subdivision where people could buy a section and build what they like with minimal or no consents or comebacks. Every buyer agrees.

People put up basic baches for generations and just got on with life. Worked well.

[macduffy]

People put up basic baches for generations and just got on with life. Worked well.

True, but they were holiday homes. Not one's pride and joy permanent res.

;)

[artemis]

True, but they were holiday homes. Not one's pride and joy permanent res.;)

Actually they were not all holiday homes. Some permanent, some rented. Family used to stay in one back in the day and others in the street were similarly basic but lived in. No longer allowed to be rented out even to existing long term tenants without big bucks to upgrade, followed by rent increases.

Time to time some of these little enclaves are in the media because long term residents have to leave.

[Sir Ten]

But first governments, central and local, need to step out of the way. Sort the RMA, sort the rural urban boundary, sort consents process and costs, stop interfering in the rental market more than with other businesses.



Agree. So simple, but seemingly, so hard.

[Bjauck]

....
- In the meantime, a large proportion of Gen X'ers and Millenials probably need to come to the realisation that home ownership is not going to be the norm for their generations. Their job is to stop procreating - which has been helped by slow wage growth relative to house price growth - i.e. large families (say, 5+) are unaffordable
- Therefore, in 30 years time we have less people, more houses and prices go down. If home ownership is not going to be the norm then it should not be treated as a special case. Net imputed rent should be taxed just like the interest from a term deposit is taxed or non-cash or fringe benefits are taxed.

Immigration not natural population increase has been a big driver in creating the demand for the limited supply. Boomers were happy to see this result in a surge in prices for their homes and rental investments often enjoying more in this untaxed capital gain than from employment or business.



I know it's very simplistic and that the government can and will tweak around the edges but, as we've seen, all governments (regardless of colour) have struggled to make much of an impact. They have been kicking the can down the road.


The variable in there that needs some attention is wage growth. And by wage growth I mean, productivity driven wage growth, not wage growth driven by government intervention (minimum wages) which just leads to price increases and inflation. At the moment, it seems like our pollies are throwing darts at the board with things like fees-free university, etc.
Productivity growth requires capital investment in business - why invest into business when you have gotten so much untaxed leveraged capital gain in real estate? Successful NZ companies have so often had to relocate their listings to Australia to access capital...

Offering meaningful change makes Parties unelectable in NZ?

[Bjauck]

...
But first governments, central and local, need to step out of the way. Sort the RMA, sort the rural urban boundary, sort consents process and costs, stop interfering in the rental market more than with other businesses.

Realistically there are going to be some limits, but need be nowhere near as many as there are now. But if people in the supply chain can make a decent buck from building, they will. And if cheap, people will buy or rent. Might mean cookie cutter or imports in containers from China. Might mean permanent trailer parks.

Might be like an idea Rodney Hide wrote about a few months ago, a small trial subdivision where people could buy a section and build what they like with minimal or no consents or comebacks. Every buyer agrees.

People put up basic baches for generations and just got on with life. Worked well. Back to dangerous and unhealthy slum housing and landlords?

[artemis]

Back to dangerous and unhealthy slum housing and landlords?

That's a simplistic and skewed point of view. Have you read the Healthy Homes standards?

If there is a shortage of rental housing, people will be much more likely to bunk up together. And there does seem to be a shortage atm, though perhaps mainly for those the private sector is not at all interested in offering a tenancy to.

If a rental does not meet all the current and coming soon standards landlords are in for huge fines. It does not mean the property is dangerous, or a slum. It might mean the insulation met the standard 3 years ago but no longer does. But might well mean the insulation does not get topped up, tenants get kicked out, move in with the rellies and the place goes on the market

"University of Otago public health professor Philippa Howden-Chapman said overcrowding was the single biggest housing-related cause of poor mental and physical health."

https://www.stuff.co.nz/life-style/homed/renting/122907853/election-2020-vanilla-housing-policies-unlikely-to-ease-auckland-rental-crowding--economist

[Bjauck]

That's a simplistic and skewed point of view. Have you read the Healthy Homes standards?

If there is a shortage of rental housing, people will be much more likely to bunk up together. And there does seem to be a shortage atm, though perhaps mainly for those the private sector is not at all interested in offering a tenancy to.

If a rental does not meet all the current and coming soon standards landlords are in for huge fines. It does not mean the property is dangerous, or a slum. It might mean the insulation met the standard 3 years ago but no longer does. But might well mean the insulation does not get topped up, tenants get kicked out, move in with the rellies and the place goes on the market

"University of Otago public health professor Philippa Howden-Chapman said overcrowding was the single biggest housing-related cause of poor mental and physical health."

https://www.stuff.co.nz/life-style/homed/renting/122907853/election-2020-vanilla-housing-policies-unlikely-to-ease-auckland-rental-crowding--economist

Slum housing for some seemed to be the inevitable consequence of what you were suggesting. So it is just that you want standards not to improve (for rental properties) - for them to be stuck in a time warp? So we need to provide more social housing to replace the gap left by landlords who would only have provided the sub-standard rental properties.

Over-crowding is the biggest cause. Government (local and national) have failed to ensure housing supply (and other infrastructure) has been able to keep up with its immigration settings. That s the trouble when the only way (under current policies) to boost the economy is by boosting the population.

Presumably there are other causes too. All those crowded boarding houses at private schools had better watch out!

[artemis]

Slum housing for some seemed to be the inevitable consequence of what you were suggesting. So it is just that you want standards not to improve (for rental properties) - for them to be stuck in a time warp? So we need to provide more social housing to replace the gap left by landlords who would only have provided the sub-standard rental properties. ....

Like I said above, have a read of the Healthy Homes regulations, not really for homes, just for rentals. And the long list of fines in the Residential Tenancies Act. If a landlord has to pay average $8k to meet the standards, the rent increase for a 2 bedroom townhouse in Parnell might work well. A rural 2 bedroom rural cottage not so much.

The HH standards are highly prescriptive and some very complex. Plus a range of new measures from Minister Faafoi. Yes they might improve conditions for tenants and actually good for landlords that stick around as they upgrade and raise rents so the tenants pay.

Landlords can make other decisions, because they can. 37% increase in house sales in September yoy - wonder where those come from?

Consequences.

[Bjauck]

As we have previously discussed rentals tend to accommodate more people, so a substandard house with just one owner-occupier would be less hazardous to them than if they had four additional house-mates. However I agree, higher standards should be phased in for all NZ housing.

Anyway we are highlighting the need for whatever government comes into power to introduce housing policies to relieve the housing shortage that has accumulated over the years if not decades. Housing has not kept up with immigration.

[artemis]

Thousands and thousands of rental vacancies advertised right now.

[Bjauck]

Thousands and thousands of rental vacancies advertised right now. What do you think that means? Post covid restrictions boom? Landlords with too high rent expectations in a covid recession? New landlords seeking tenants?

[artemis]

What do you think that means? Post covid restrictions boom? Landlords with too high rent expectations in a covid recession? New landlords seeking tenants?

Maybe all of the above and more. Even so, 20,000 waiting for heavily taxpayer subsidised housing can apply for them. And the taxpayer will still supply the Accommodation Supplement, TAS, bond and initial rent. Hard to keep talking about housing shortage with thousands of rental vacancies.

If landlords decide not to reduce rent they will have their reasons. And if they are forgoing income the reasons will be acceptable to them.

[Bjauck]

Maybe all of the above and more. Even so, 20,000 waiting for heavily taxpayer subsidised housing can apply for them. And the taxpayer will still supply the Accommodation Supplement, TAS, bond and initial rent. Hard to keep talking about housing shortage with thousands of rental vacancies.
..
Covid recession and covid tourism restrictions means a change in employment opportunities. Some regions are more heavily impacted. I would say that that since lockdown restrictions were eased there would also be population movement - so perhaps there could also be quite a few tenants looking for accommodation too. A jump in available accommodation at the moment, may not necessarily mean there are not still many people who are living in overcrowded conditions.

Also with fewer foreign students, and fewer inward arrivals generally, there may be previously rented out accommodation looking for new tenants.

[moka]

Green Party candidate Ali Hale Tilley says middle salary and wage earners carry more than their fair share of the tax burden and that if we want the country to prosper as a whole, the wealthy need to embrace paying tax instead of finding ways to hide it.
"It's the nation's mindset that needs changing," she said. "It's a privilege to pay taxes. When it gets reinvested, everybody is lifted up."

https://www.nzherald.co.nz/nz/politics/local-focus-to-tax-or-not-to-tax-whanganui-candidates-debate-a-rebate/SY26Y3F7XN4E2XFKMRF53WWG44/

[lissica]

Green Party candidate Ali Hale Tilley says middle salary and wage earners carry more than their fair share of the tax burden and that if we want the country to prosper as a whole, the wealthy need to embrace paying tax instead of finding ways to hide it.
"It's the nation's mindset that needs changing," she said. "It's a privilege to pay taxes. When it gets reinvested, everybody is lifted up."

https://www.nzherald.co.nz/nz/politics/local-focus-to-tax-or-not-to-tax-whanganui-candidates-debate-a-rebate/SY26Y3F7XN4E2XFKMRF53WWG44/

Treasury states that the top 3% pay 24% of income tax. I'm paying more than my fair share.

https://www.treasury.govt.nz/information-and-services/financial-management-and-advice/revenue-expenditure/revenue-effects-tax-changes/who-pays-income-tax

[couta1]

Green Party candidate Ali Hale Tilley says middle salary and wage earners carry more than their fair share of the tax burden and that if we want the country to prosper as a whole, the wealthy need to embrace paying tax instead of finding ways to hide it.
"It's the nation's mindset that needs changing," she said. "It's a privilege to pay taxes. When it gets reinvested, everybody is lifted up."

https://www.nzherald.co.nz/nz/politics/local-focus-to-tax-or-not-to-tax-whanganui-candidates-debate-a-rebate/SY26Y3F7XN4E2XFKMRF53WWG44/ I don't give a toss what any Green Party candidate says about taxes, they are all economically inept so why should I trust them?

[artemis]

With the increase in top tax rates will there be a shift to growth stocks away from those that pay divvies?

[moka]

In the debate, Chloe Swarbrick from the Greens argued for the wealth tax, pointing out that wealth in property is created by taxes spent on infrastructure.
I heard from a man this week who objected to the way a wealth tax would penalise people who bought a bach in Coromandel back when the road trip took six hours, and now owned valuable property but were not rich.
But Swarbrick is right. Those baches are now worth a fortune in part because the roads, paid for by taxes, now make the journey so much quicker.

https://www.nzherald.co.nz/nz/politics/simon-wilson-rapture-or-reform-jacinda-ardern-and-the-wealth-tax/7OKVMX7TQQU3E3U4PAG56BF4UY/

Shia Navot from Top, however, argued against the Greens' wealth tax, but not because wealth shouldn't be taxed. Top thinks there are better ways to do it.
Perhaps they're right. Greens co-leader James Shaw has said many times, if other parties don't like their proposal, he would welcome them coming up with something better.
Labour's David Parker, the trade minister, told an OECD conference this week there is a growing gap between the wealthy who can leverage their assets at very low interest rates, and the young and others without assets. "There is a problem with this status quo around the world," he said, "and we need a conversation about what the remedy might be."

[moka]

Treasury states that the top 3% pay 24% of income tax. I'm paying more than my fair share.

https://www.treasury.govt.nz/information-and-services/financial-management-and-advice/revenue-expenditure/revenue-effects-tax-changes/who-pays-income-taxYou are not paying more than your fair share.
Your fair share takes into account your ability to pay, not what you pay in relation to anyone else.
A fair tax system means that the costs of contributing to tax revenues are shared in a way that takes into account the ability to pay.

From each according to their ability, to each according to their needs" Karl Marx
The phrase 'From each according to his ability, to each according to his needs' means, that ideally, each person should contribute to society according to his or her best efforts to do so, and should nonetheless receive from society what he or she requires to survive in relative health and safety.

[fungus pudding]

You are not paying more than your fair share.
Your fair share takes into account your ability to pay, not what you pay in relation to anyone else.
A fair tax system means that the costs of contributing to tax revenues are shared in a way that takes into account the ability to pay.

From each according to their ability, to each according to their needs" Karl Marx
The phrase 'From each according to his ability, to each according to his needs' means, that ideally, each person should contribute to society according to his or her best efforts to do so, and should nonetheless receive from society what he or she requires to survive in relative health and safety.

A flat tax, where everyone pays the same percentage on their earnings is the fairest way in my view, Big earners pay a lot - low earners pay little. Yet the socialists scream that that is unfair, because the high earners can afford more, so argue for a progressive system. And that sums up the problem in a nutshell. 'Fair' is impossible to define, making it a pointless and senseless word in relation to tax given there is no acceptable agreement.

[couta1]

A flat tax, where everyone pays the same percentage on their earnings is the fairest way in my view, Big earners pay a lot - low earners pay little. Yet the socialists scream that that is unfair, because the high earners can afford more, so argue for a progressive system. And that sums up the problem in a nutshell. 'Fair' is impossible to define, making it a pointless and senseless word in relation to tax given there is no acceptable agreement. Absolutely a flat tax is the fairest by a country mile but will never happen under a Socialist/Communist Govt, their agenda will always be to take from those that have and redistribute to those that have not, the fact that many of the have not's don't want to get ahead if it takes self effort is of no consequence.

[Zaphod]

But Swarbrick is right. Those baches are now worth a fortune in part because the roads, paid for by taxes, now make the journey so much quicker.


That is one rabbit hole I would avoid going down. It will result in never-ending arguments.

I do recall Twyford suggesting that land owners near major transport projects would be required to fund their development as they were viewed as disproportionately benefiting from them, so perhaps we will have no choice but to address this argument in the longer term.

[dibble]

I do recall Twyford suggesting that land owners near major transport projects would be required to fund their development as they were viewed as disproportionately benefiting from them, so perhaps we will have no choice but to address this argument in the longer term.

That should definitely apply to the nice new 6 lane motorway carved through one's back yard.

[dibble]

Out of curiosity, if a CGT has as a goal to steer money to productive investments does anyone know what these investments are for the average retail investor? The sentiment is bandied about and certainly has some logic but assuming the money isnt headed offshore (the FDR tax complexity is disincentive enough on that front) quite what are people supposed to buy instead, a coffee franchise?

We've just seen the hunger for longish bonds at about 2% so there appears to be no shortage of money seeking some sort of investment home and i dont see a lot of biotech or invention type funds. The lack of NZX listings suggests something is amiss but is it as simple as blaming untaxed housing?

[artemis]

Out of curiosity, if a CGT has as a goal to steer money to productive investments does anyone know what these investments are for the average retail investor? The sentiment is bandied about and certainly has some logic but assuming the money isnt headed offshore (the FDR tax complexity is disincentive enough on that front) quite what are people supposed to buy instead, a coffee franchise?

We've just seen the hunger for longish bonds at about 2% so there appears to be no shortage of money seeking some sort of investment home and i dont see a lot of biotech or invention type funds. The lack of NZX listings suggests something is amiss but is it as simple as blaming untaxed housing?

Some good questions there, dibble. The Labour CGT policy originally covered some assets but not others. Your de Kooning and heirloom diamond tiara were not included, nor were the family bach or small business if and only if sold under strict rules to fund retirement. Don't think those small businesses included rentals though. The last couple were tweaks based on negative feedback.

Along came the Tax Working Group with an increasing level of complexity. Finally it seeped into the voter's mind that their shares, their Kiwisaver, their farm, their lifestyle block were up for grabs. Not to mention their coffee franchise if sold. Idea dumped.

What Labour really wanted was to tax private rental housing and encourage it out of the market into 100,000 affordable homes and taxpayer subsidised social housing. When the CGT didn't work they changed tax rules for private rentals and brought in a lot of extra cost and compliance. Possibly get the desired result over time. Ms Ardern seems to think 2030 would be about right though as there is not much money in the kitty 2030 looks optimistic.

[moka]

A flat tax, where everyone pays the same percentage on their earnings is the fairest way in my view, Big earners pay a lot - low earners pay little. Yet the socialists scream that that is unfair, because the high earners can afford more, so argue for a progressive system. And that sums up the problem in a nutshell. 'Fair' is impossible to define, making it a pointless and senseless word in relation to tax given there is no acceptable agreement.I’m sure you’d quickly come up with a definition of fair (or unfair) if the government started taxing you at 100%. When you are advantaged by a situation fair is supposedly impossible to define, and that would change if you were disadvantaged.

If you believe in the greed is good ideology you would say fair is impossible to define. But if you wanted a tax system that was considered fair by most of the citizens then fairness would be seen as social justice and people would be taxed according to their ability to pay.
However there is lots of money to be made by lawyers and accountants advising the rich how to minimise, avoid and evade taxes, so plenty of propaganda in the media saying fair is impossible to define, and advocating for a flat tax.

[artemis]

I’m sure you’d quickly come up with a definition of fair (or unfair) if the government started taxing you at 100%. When you are advantaged by a situation fair is supposedly impossible to define, and that would change if you were disadvantaged.

If you believe in the greed is good ideology you would say fair is impossible to define. But if you wanted a tax system that was considered fair by most of the citizens then fairness would be seen as social justice and people would be taxed according to their ability to pay.
However there is lots of money to be made by lawyers and accountants advising the rich how to minimise, avoid and evade taxes, so plenty of propaganda in the media saying fair is impossible to define, and advocating for a flat tax.

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas Sowell

[fungus pudding]

You are not paying more than your fair share.
Your fair share takes into account your ability to pay, not what you pay in relation to anyone else.
A fair tax system means that the costs of contributing to tax revenues are shared in a way that takes into account the ability to pay.

From each according to their ability, to each according to their needs" Karl Marx


'Ability to pay' does not make for fairness. Should a tin of baked beans cost more if you happen to be very wealth? You and Karl Marx might think so, but not many do.

[Bjauck]

'Ability to pay' does not make for fairness. Should a tin of baked beans cost more if you happen to be very wealth? You and Karl Marx might think so, but not many do.

If the consequence of an offence against the law of the land is both punishment and deterrence. Do you think that fines should be levied at amounts according to the transgressor's ability to pay?

Otherwise for one person $80 is petty cash but for another it means no food for a week. The punishment would not necessarily fit the infringement?

[fungus pudding]

If the consequence of an offence against the law of the land is both punishment and deterrence. Do you think that fines should be levied at amounts according to the transgressor's ability to pay?

Of course, but a fine is not primarily a money raising exercise; it is a punishment and while $1 would be severe punishment to me you probably wouldn't blink at a $10,000 fine.:D

[Bjauck]

Of course, but a fine is not primarily a money raising exercise; it is a punishment and while $1 would be severe punishment to me you probably wouldn't blink at a $10,000 fine.:D I Wish that that were true...

If not a Punishment...taxes are used to encourage certain activities (and resulting in deterrence for others)

Ability to be able to pay taxes must be a factor in deciding whether to levy them in the first place.

[fungus pudding]

I Wish that that were true...

If not a Punishment...taxes are used to encourage certain activities (and resulting in deterrence for others)

Ability to be able to pay taxes must be a factor in deciding whether to levy them in the first place.

Indeed, So they should be levied so a low earner can pay them. Obviously a high earner could fairly be taxed the same percentage on his higher income. X on y Dollars should mean 2x on 2y, but not 3x on 2y.

[Bjauck]

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas Sowell Fairness and social justice are nothing new. They have always been with us. They have just varied in their interpretation according to time and place.

[moka]

'Ability to pay' does not make for fairness. Should a tin of baked beans cost more if you happen to be very wealth? You and Karl Marx might think so, but not many do.
What Is Fairness? It depends on the situation. Ideologues believe that only their notion of fairness is correct.

1. SAMENESS: There is the fairness where everything is equal. So everyone pays the same price for a theater ticket, whether a child, an adult or a senior citizen. No one has more than another. Everyone eats or no one does, for example. Logically, then, an infant and an adolescent will receive the same amount of food. It doesn’t matter that one needs more than the other. Fairness is finding the average and applying it across the board. This is fairness as equality of outcome.

2. DESERVEDNESS: In this notion of fairness you get what you deserve. If you work hard, you succeed and keep all that you earn. Fairness means keeping what you deserve and deserving nothing if it isn’t earned. The hardest working, most diligent, smartest and most talented should have more because of their attributes; the lazy, indifferent, stupid and inept deserve to have less. Fairness is a rational calculation. This is fairness as individual freedom.

3. NEED: The third idea of fairness is that those who have more to give should give a greater percentage of what they have to help others who are unable to contribute much, if anything at all. Fairness here takes into account the facts that humans have obligations to one another and the more one has the more is demanded of that person to contribute to the common good. Fairness and responsibility are linked. Compassion plays a role in the calculation of fairness. This is fairness as social justice.

https://www.psychologytoday.com/us/blog/am-i-right/201205/its-not-fair-what-is-fairness

[moka]

"Since this is an era when many people are concerned about 'fairness' and 'social justice,' what is your 'fair share' of what someone else has worked for?" Thomas SowellActually it is labour that does the work to produce the goods or services, while the capitalist does not need to do any work.
Profits from capital invested don’t need to involve work, so labour should get most of the income because they do the actual work while the capitalist sits on the couch. But that is not how it works because capitalism is based on exploitation due to the imbalance of power between capital and labour.
But it is like the myth of the self-made man. Does he grow and cook his own food? He uses the resources of society like roads, electricity, buildings, knowledge, and other people, including his customers.
He is successful because he uses the “common wealth” of society which has been built up by others including previous generations.

[moka]

I Wish that that were true...

If not a Punishment...taxes are used to encourage certain activities (and resulting in deterrence for others)

Ability to be able to pay taxes must be a factor in deciding whether to levy them in the first place.True, ability to pay must be a factor in levying taxes.

​However the main function of taxes is social investment, or public investment. And tax is the foundation of a civilised and fair society.
The more investment in society, in infrastructure, education, health and other public services the wealthier the society which is of benefit to everyone. You would think capitalists would understand how necessary investment is and therefore be willing to pay their fair share of tax, but it seems that many don’t see it that way.

[couta1]

Why is there an estimated 20 billion dollar black economy in NZ if its fair then? Change to a flat tax rate of 20% and watch a lot of that 20 billion make its way back into the system.

[moka]

Why is there an estimated 20 billion dollar black economy in NZ if its fair then? Change to a flat tax rate of 20% and watch a lot of that 20 billion make its way back into the system.There is a black economy because unfairness and exploitation are part and parcel of capitalism. It is normal business practice. Changing to a flat tax rate of 20% would not change the behaviour of those who operate in the black economy.

Winning and success are what matters and honesty and integrity are secondary and are surrendered in order to get what you want.

Predatory capitalism is encouraged. Predatory capitalism is where a country’s trade and industry are controlled by private owners for profit, rather than by the state. Predatory capitalism refers to cultural acceptance of domination and exploitation as normal economic practice.

The appropriation and accumulation of wealth occur in two different ways.
There is a vast array of extra-legal activities such as robbery, thievery, swindling, corruption, violence and coercion along with a range of suspicious and shady practices in the market (monopolisation, manipulation, market cornering, price fixing, Ponzi schemes etc.)

Secondly, individuals accumulate wealth by legally sanctioned exchanges under conditions of non-coercive trade in freely functioning markets.

The first sort of activities are typically excluded as external to the “normal” and legitimate functioning of the capitalist market. This is a misleading fiction. It is stupid to seek to understand the world of capital without looking at the drug cartels, traffickers in arms and the various mafia and other criminal forms of organisation that play such a significant role in world trade.

There is a vast array of predatory practices e.g. falsification of assets, money laundering, Ponzi finance, and interest rate manipulations revealed by the GFC and by the Australian Royal Commission into Banking. We are talking mainstream organisations here, not “criminal organisations.”

An economy based on dispossession lies at the heart of what capitalism is foundationally about. Bankers do not care in principal whether their profits and excessive bonuses come from lending money to those who exploit others.

The desire for money as a form of social power becomes an end in itself which distorts the neat demand –supply relation of the money that would be required to simply facilitate exchange.

[moka]

Here is what Albert Einstein had to say about predatory behaviour and socialism in 1949.

http://monthlyreview.org/2009/05/01/why-socialism/ (http://monthlyreview.org/2009/05/01/why-socialism/)

Why Socialism?
But historic tradition is, so to speak, of yesterday; nowhere have we really overcome what Thorstein Veblen called “the predatory phase” of human development. The observable economic facts belong to that phase and even such laws as we can derive from them are not applicable to other phases.

Since the real purpose of socialism is precisely to overcome and advance beyond the predatory phase of human development, economic science in its present state can throw little light on the socialist society of the future.

But the personality that finally emerges is largely formed by the environment in which a man happens to find himself during his development, by the structure of the society in which he grows up, by the tradition of that society, and by its appraisal of particular types of behavior. The abstract concept “society” means to the individual human being the sum total of his direct and indirect relations to his contemporaries and to all the people of earlier generations.

The individual is able to think, feel, strive, and work by himself; but he depends so much upon society—in his physical, intellectual, and emotional existence—that it is impossible to think of him, or to understand him, outside the framework of society.

It is “society” which provides man with food, clothing, a home, the tools of work, language, the forms of thought, and most of the content of thought; his life is made possible through the labor and the accomplishments of the many millions past and present who are all hidden behind the small word “society.”

It concerns the relationship of the individual to society. The individual has become more conscious than ever of his dependence upon society. But he does not experience this dependence as a positive asset, as an organic tie, as a protective force, but rather as a threat to his natural rights, or even to his economic existence. Moreover, his position in society is such that the egotistical drives of his make-up are constantly being accentuated, while his social drives, which are by nature weaker, progressively deteriorate.

All human beings, whatever their position in society, are suffering from this process of deterioration. Unknowingly prisoners of their own egotism, they feel insecure, lonely, and deprived of the naive, simple, and unsophisticated enjoyment of life.

Man can find meaning in life, short and perilous as it is, only through devoting himself to society.

I am convinced there is only one way to eliminate these grave evils, namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals.

[BlackPeter]

Treasury states that the top 3% pay 24% of income tax. I'm paying more than my fair share.

https://www.treasury.govt.nz/information-and-services/financial-management-and-advice/revenue-expenditure/revenue-effects-tax-changes/who-pays-income-tax

Well, but then the top 5% in NZ own 39% of all wealth. Maybe they don't pay their fair share of taxes?

[BlackPeter]

I don't give a toss what any Green Party candidate says about taxes, they are all economically inept so why should I trust them?

Well, everybody is entitled to their opinion, but if you consider e.g. James Shaw as economical inept, then you might be in a minority position. I had some interaction with him and consider him as highly intelligent and economically ept.

I guess what you really want to say is that you don't like what they say, but this does not mean that they are wrong and you are right.

Throwing around unproven generic statements like "they are all ... inept" is a sad reflection on the person making this statement. I know you can do better.

[couta1]

Well, everybody is entitled to their opinion, but if you consider e.g. James Shaw as economical inept, then you might be in a minority position. I had some interaction with him and consider him as highly intelligent and economically ept.

I guess what you really want to say is that you don't like what they say, but this does not mean that they are wrong and you are right.

Throwing around unproven generic statements like "they are all ... inept" is a sad reflection on the person making this statement. I know you can do better. Well if James Shaw had his way with the NZ economy how would it look in a few years? If the economy suffers big time because of their environmental obsession then that is inept IMO.

[Bjauck]

Well if James Shaw had his way with the NZ economy how would it look in a few years? If the economy suffers big time because of their environmental obsession then that is inept IMO. I am not sure how any Party can avoid being concerned about the environment these days. That is unless they want humans to be part of a man-made mass extinction event. The longer things are swept under the carpet, the more we will have to become "obsessed with" the environment.

[peat]

I had some interaction with James Shaw and consider him as highly intelligent and economically ept.


I dont believe ept is actually a word , even if inept is a word , and the best definition of the acronym EPT on the internet was 'excess profits tax' so thats what you meant right? coz it fits in well !

[arekaywhy]

Actually it is labour that does the work to produce the goods or services, while the capitalist does not need to do any work.
Profits from capital invested don’t need to involve work, so labour should get most of the income because they do the actual work while the capitalist sits on the couch. But that is not how it works because capitalism is based on exploitation due to the imbalance of power between capital and labour.
But it is like the myth of the self-made man. Does he grow and cook his own food? He uses the resources of society like roads, electricity, buildings, knowledge, and other people, including his customers.
He is successful because he uses the “common wealth” of society which has been built up by others including previous generations.

Maybe think a bit harder before making a statement such as this

[Bjauck]

I dont believe ept is actually a word , even if inept is a word , and the best definition of the acronym EPT on the internet was 'excess profits tax' so thats what you meant right? coz it fits in well ! True, not all backforms of words exist. Online American dictionaries may not have all defintions. However"ept" has an entry in my SOE (New Shorter Oxford English Dictionary) with the meaning of adroit, competent, appropriate, effective.

What do they say...a little bit of knowledge is a dangerous thing ;) (Edit - I mean that in relation to the online dictionaries!)

[fungus pudding]

I dont believe ept is actually a word , even if inept is a word , and the best definition of the acronym EPT on the internet was 'excess profits tax' so thats what you meant right? coz it fits in well !

The opposite of inept is adept.

[fungus pudding]

Maybe think a bit harder before making a statement such as this

You are asking the impossible.

[arekaywhy]

Whilst I don't like the idea of a capital gains tax, as I just don't want any more taxes...I do think that a flat income tax and flat capital gains tax, applied to all capital gains, no exemptions, will level the playing field. This must still leave room for a minimum amount of income that is not taxed at all, so that those starting out in life can get the basics sorted for themselves, rather than relying on nanny state to look after them

[Bjauck]

The opposite of inept is adept.
"Ept" is a perfectly valid word (see my post above) and was used appropriately by BP in conveying his meaning.

[fungus pudding]

"Ept" is a perfectly valid word (see my post above) and was used appropriately by BP in conveying his meaning.

Precisely why I didn't say it wasn't. However it is not universally excepted. In my scrabble playing days it was not a permitted word.

[Bjauck]

Precisely why I didn't say it wasn't. However it is not universally excepted. In my scrabble playing days it was not a permitted word. I would say that its meaning is understood even if "adept" is the preferred antonym to "inept". Who does not accept the word "ept"?

As a matter of interest Did you allow dialect words or American spellings for scrabble?

[fungus pudding]

I would say that its meaning is understood even if "adept" is the preferred antonym to "inept". Who does not accept the word "ept"?

As a matter of interest Did you allow dialect words or American spellings for scrabble?

I have just checked the official scrabble dictionary 'scrabblewordfinder.org' , and surprisingly it's still not there. I'm not sure how 'official' the online one is - I'd never seen or used it before. I used to have the official one that listed all words that were acceptable, English or American, a compilation from all dictionaries - and I'm sure it wasn't in there - but that's going back a while. But yes, it doesn't take much to realise what is meant - so I would not argue that it is not a legitimate word; just that it is not universally accepted.

[macduffy]

Post deleted.

[Bjauck]

Deleted - too tangential.

[BlackPeter]

Well if James Shaw had his way with the NZ economy how would it look in a few years? If the economy suffers big time because of their environmental obsession then that is inept IMO.

.. and if the environment (as we need it to economically survive) goes extinct due to some dinosaurs deciding that we need to continue with its destruction, what do you think would this mean to our NZ economy?

Climate change has arrived, the only question is whether humanity as we know it gets through it with limited damage, with lots of damage or not at all.

One third of our economy (at the moment probably more) is dependant on agriculture. Just consider what the rapidly increasing frequency of draughts, extreme flooding and increased storm intensity will do to our economy?

Just compare the insurance premiums for your house with the premiums you payed a decade or two ago. What happened to them? They went up steeply, didn't they, and that's not for insurance companies getting rich.

Same thing (only worse) for farmers. Many find it already difficult to pay the premiums to insure their crops ... it won't take long anymore until many farmers are not able to insure their crop against adverse weather events. An increasing number of big weather disaster impacting on our agriculture will do our economy under these circumstances well, won't it?

But this is just one example ... infrastructure cost will go steeply up with climate change, new pests and diseases are coming into the country and need money to fight, the pressure from climate change refugees will go up world wide.

Maybe the Greens are the better economists after all? Always good to look at the big picture rather than focussing solely on the next quarters earnings ...

[couta1]

.. and if the environment (as we need it to economically survive) goes extinct due to some dinosaurs deciding that we need to continue with its destruction, what do you think would this mean to our NZ economy?

Climate change has arrived, the only question is whether humanity as we know it gets through it with limited damage, with lots of damage or not at all.

One third of our economy (at the moment probably more) is dependant on agriculture. Just consider what the rapidly increasing frequency of draughts, extreme flooding and increased storm intensity will do to our economy?

Just compare the insurance premiums for your house with the premiums you payed a decade or two ago. What happened to them? They went up steeply, didn't they, and that's not for insurance companies getting rich.

Same thing (only worse) for farmers. Many find it already difficult to pay the premiums to insure their crops ... it won't take long anymore until many farmers are not able to insure their crop against adverse weather events. An increasing number of big weather disaster impacting on our agriculture will do our economy under these circumstances well, won't it?

But this is just one example ... infrastructure cost will go steeply up with climate change, new pests and diseases are coming into the country and need money to fight, the pressure from climate change refugees will go up world wide.

Maybe the Greens are the better economists after all? Always good to look at the big picture rather than focussing solely on the next quarters earnings ... Climate change hasn't just arrived its been going around in a cycle since Adam and NZ can't make any meaningful difference toward controlling it, so why ruin the economy because of it.

[blackcap]

..

Climate change has arrived, the only question is whether humanity as we know it gets through it with limited damage, with lots of damage or not at all.





Not according to this environmentalist:

On behalf of environmentalists everywhere, I would like to formally apologize for the climate scare we created over the last 30 years. Climate change is happening. It’s just not the end of the world. It’s not even our most serious environmental problem.

I may seem like a strange person to be saying all of this. I have been a climate activist for 20 years and an environmentalist for 30.

But as an energy expert asked by Congress to provide objective expert testimony, and invited by the Intergovernmental Panel on Climate Change (IPCC) to serve as Expert Reviewer of its next Assessment Report, I feel an obligation to apologize for how badly we environmentalists have misled the public.

https://environmentalprogress.org/big-news/2020/6/29/on-behalf-of-environmentalists-i-apologize-for-the-climate-scare

[artemis]

'AGW' turned into 'climate change' for a reason.

[arekaywhy]

'AGW' turned into 'climate change' for a reason.


heh, yeah, I predict they'll change it soon to "climate general inconvenience"...now pay me more taxes!

[Bjauck]

17 year old & 14yo buy a ChCh investment property using money they inherited. They plan to hold then sell for the capital gains. They already know the how the best tax free money is made in Aotearoa. Labour is keeping this intact. Labour may have their work cut out encouraging post covid investment in business and employment preservation.
https://www.stuff.co.nz/business/property/123136971/christchurch-firsthome-buyers-face-massive-interest-and-rising-prices

[fungus pudding]

17 year old & 14yo buy a ChCh investment property using money they inherited. They plan to hold then sell for the capital gains. They already know the how the best tax free money is made in Aotearoa. Labour is keeping this intact. Labour may have their work cut out encouraging post covid investment in business and employment preservation.
https://www.stuff.co.nz/business/property/123136971/christchurch-firsthome-buyers-face-massive-interest-and-rising-prices

I presume you read that article. Those young buyers will be taxed on that capital gain. Their admitted intention is to profit from selling, and you can bet your bottom dollar the IRD will have noted that purchase.
You may remember some years ago a purchaser made a similar statement on a TV program. I can't remember the details, but I can remember the screams of protest when he discovered he had revealed his intention was to profit from selling and that the IRD, after viewing the program, had stated he would be taxed.

[Bjauck]

I presume you read that article. Those young buyers will be taxed on that capital gain. Their admitted intention is to profit from selling, and you can bet your bottom dollar the IRD will have noted that purchase.
You may remember some years ago a purchaser made a similar statement on a TV program. I can't remember the details, but I can remember the screams of protest when he discovered he had revealed his intention was to profit from selling and that the IRD, after viewing the program, had stated he would be taxed.

They said they may live in their investment. Will their expressed intent to sell (for the capital gain) result in any gain being taxable, whether they live in the property as owner-occupiers or not? If this is their first property, would that make a difference?

If someone states when buying a house, which they occupy or leave empty in case they occupy it in the future , that they are buying it to live in and also with the subsidiary intention of selling it for the capital gain, is the capital gain on sale taxable as it was an intent when the house was purchased? Would the capital gain only be taxable if it were decided that the main intention of the owner-occupier was to sell for a capital gain?

[fungus pudding]

They said they may live in their investment. Will their expressed intent to sell (for the capital gain) result in any gain being taxable, whether they live in the property as owner-occupiers or not? If this is their first property, would that make a difference?

If someone states when buying a house, which they occupy or leave empty in case they occupy it in the future , that they are buying it to live in and also with the subsidiary intention of selling it for the capital gain, is the capital gain on sale taxable as it was an intent when the house was purchased? Would the capital gain only be taxable if it were decided that the main intention of the owner-occupier was to sell for a capital gain?

The IRD decide that on a case-by-case basis. Intent is the deciding factor, and IRD are the judge of intent. They must have a large number of mind-readers on their staff.

[moka]

Maybe think a bit harder before making a statement such as this

The statement I made that I have been thinking about is below.


Actually it is labour that does the work to produce the goods or services, while the capitalist does not need to do any work.
Profits from capital invested don’t need to involve work, so labour should get most of the income because they do the actual work while the capitalist sits on the couch. But that is not how it works because capitalism is based on exploitation due to the imbalance of power between capital and labour.
But it is like the myth of the self-made man. Does he grow and cook his own food? He uses the resources of society like roads, electricity, buildings, knowledge, and other people, including his customers.
He is successful because he uses the “common wealth” of society which has been built up by others including previous generations.
I did a bit more research and other thinking people agree with me.
Good graph in the article showing worker’s incomes have flat-lined for half a century but their productivity, which is roughly the profit that they earn for capitalists, has skyrocketed since 1974.

https://eand.co/how-capitalism-taught-americans-to-love-exploitation-5db12d3a6e93
So exploitation is so routine, so normal in America that it’s an everyday, commonplace affair — which people are quite invisible to.
And that is because capitalism’s foundational belief, which it has been long taught, maybe even indoctrinated, into Americans, is that if we each exploit everyone that we can, beginning with ourselves, as ruthlessly and mercilessly as possible, then everyone will be better off, not just the capitalists. (Because the strong will survive — and even the weak will benefit, by becoming a little more selfish, tough, independent, and less of a burden upon the strong.)

The person at the bottom has contributed in a very real, and very significant way, to the billions that Bezos has amassed.

Predatory capitalism made “work” largely the execution and perfection of exploitation. Instead of labour being the expression of the human possibility (like, say, discovering antibiotics, building a healthcare system, making it affordable to get an education), it became the predation upon human vulnerability (like, say, fine-tuning the algorithm for maximum revenue, with horrific clickbait videos, looting pension funds, overcharging students for debt, hiking up drug prices thousands of percent, and so on.)

[GTM 3442]

The IRD decide that on a case-by-case basis. Intent is the deciding factor, and IRD are the judge of intent. They must have a large number of mind-readers on their staff.

I suspect that they prefer mind readers to test cases. There is an awful lot of case law around intent which is simply missing.

[artemis]

The IRD decide that on a case-by-case basis. Intent is the deciding factor, and IRD are the judge of intent. They must have a large number of mind-readers on their staff.

A couple of excited kids interviewed by media would I hope be an extenuating factor in any IRD decision. If that turns out not to be taken into account I predict a backlash against the rather grey IRD rules.

[Bjauck]

A couple of excited kids interviewed by media would I hope be an extenuating factor in any IRD decision. If that turns out not to be taken into account I predict a backlash against the rather grey IRD rules. At age of 17 and younger can a minor actually own the house? Presumably there is an adult or trustee behind them to take legal ownership? So in this case "the owner's" intent may be different from that of the minors/beneficiaries?

https://www.nzherald.co.nz/property/parents-buying-property-for-children/IUIF32TCVGS2UM7W6X6QJIGDYY/

I imagine in a housing market with rising prices, that there may be many owner-occupiers buying a primary residence to live in, with another intent to sell the house at a higher price on their way "up the property ladder." With such a high priced property market, many first home buyers must buy intending to sell to trade their way "up" from a small apartment to a family sized house in a safe neighbourhood, taking advantage of boost to deposits from leveraging and extra income from any career promotion?

[Bjauck]

...
I did a bit more research and other thinking people agree with me.
Good graph in the article showing worker’s incomes have flat-lined for half a century but their productivity, which is roughly the profit that they earn for capitalists, has skyrocketed since 1974.... I guess the first capitalist was the ace hunter gatherer caveman who was rewarded with the best and biggest portion of the day's kill. He did not want it, so he traded it for an extra spear.

Eventually he had a cave full of spears. By then, he was old and couldn't hunt. If the others used his amassed spears then it would mean hunters could hunt instead of making spears instead. The band of humans would be more productive. If they decided not to simply steal the spears from the old alpha hunter, how much would this extra productivity be worth and should they still give hum the choicest cut of mammoth or sabre-tooth?

On the other hand, the retired alpha hunter is a wily old codger. His old wife came from a different band of humans. Their lands are now impoverished and they are facing hunger. Their young men would be willing to hunt the land of the Alpha hunter's band and give him meat plus half the antlers and ivory.

So capital, saving and specialisation make labour more productive. How much they are relatively worth is the question

[moka]

https://thespinoff.co.nz/politics/20-10-2020/jacinda-ardern-and-transforming-the-would-be-transformer/
Take tax reform. Ardern didn’t just abandon capital gains tax because of the Peters brake. She banned it from Labour policy while she is leader, thereby telling us that Labour accepts it is OK some people don’t pay tax on some of their income. (should that be capital not income?)
Same for tax on wealth, a major determinant of generational material inequality.
Labour’s campaign tax policy was skimpy: a 6-point rise in tax on the incomes of a tiny few at the top. No move down a path Robertson endorsed in private when in opposition: to reduce the heavy reliance on taxing incomes and instead tax environmental degradation and privatisation of natural resources for profit.
Ardern banned capital gains tax because, she said, there was no public mandate for it. But true mandates are built, not given. Ardern in essence said she would not try to build a mandate for taxing income from capital gain.

[fungus pudding]

https://thespinoff.co.nz/politics/20-10-2020/jacinda-ardern-and-transforming-the-would-be-transformer/
Take tax reform. Ardern didn’t just abandon capital gains tax because of the Peters brake. She banned it from Labour policy while she is leader, thereby telling us that Labour accepts it is OK some people don’t pay tax on some of their income. (should that be capital not income?)
Same for tax on wealth, a major determinant of generational material inequality.
Labour’s campaign tax policy was skimpy: a 6-point rise in tax on the incomes of a tiny few at the top. No move down a path Robertson endorsed in private when in opposition: to reduce the heavy reliance on taxing incomes and instead tax environmental degradation and privatisation of natural resources for profit.
Ardern banned capital gains tax because, she said, there was no public mandate for it. But true mandates are built, not given. Ardern in essence said she would not try to build a mandate for taxing income from capital gain.

Profits from capital gain are different from income from capital gain. Income from capital gain is and always has been taxed. I don't expect you to know the difference.

[SBQ]

https://thespinoff.co.nz/politics/20-10-2020/jacinda-ardern-and-transforming-the-would-be-transformer/
Take tax reform. Ardern didn’t just abandon capital gains tax because of the Peters brake. She banned it from Labour policy while she is leader, thereby telling us that Labour accepts it is OK some people don’t pay tax on some of their income. (should that be capital not income?)
Same for tax on wealth, a major determinant of generational material inequality.
Labour’s campaign tax policy was skimpy: a 6-point rise in tax on the incomes of a tiny few at the top. No move down a path Robertson endorsed in private when in opposition: to reduce the heavy reliance on taxing incomes and instead tax environmental degradation and privatisation of natural resources for profit.
Ardern banned capital gains tax because, she said, there was no public mandate for it. But true mandates are built, not given. Ardern in essence said she would not try to build a mandate for taxing income from capital gain.

Don't forget all that fancy $ that went into paying the Working Tax Group, for which their recommendation WAS for NZ to have some form of CGT, particularly on real estate (where the top 1% have locked in their wealth). Then the following week Ms Ardern made that statement on TV - "No CGT for as long as she is politics".

I met with my new bank manager earlier in the week and I expressed the same issue. Why is it only wealthy have done so well in real estate while the middle class struggle in their Kiwi Saver? The 5 year stand down 'bright line test' is a joke and again it shows Ms Ardern not being serious about a 'fair tax policy' for NZ.

[kiora]

Windfall tax anyone?
"NZME is now in the process of returning $15m in cash to shareholders through share buy-backs and special dividends. It is not the only one. Fletcher Building received $68m in wage subsidy cash during 2020 and has refused to repay it, despite an increasingly robust profit and balance sheet. It paid $140m of cash dividends to shareholders in April this year after reporting solid profit growth and a strong outlook because of a boom in house building and building materials sales. NZME and Fletcher Building are just two among many large and small New Zealand companies that have refused to repay the cash, despite reporting profit growth and higher cash reserves."
https://www.interest.co.nz/public-policy/116888/bernard-hickey-argues-20b-covid-cash-should-be-returned-taxpayers-along-20b?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Tuesday+26+ July+2022

[SBQ]

Windfall tax anyone?
"NZME is now in the process of returning $15m in cash to shareholders through share buy-backs and special dividends. It is not the only one. Fletcher Building received $68m in wage subsidy cash during 2020 and has refused to repay it, despite an increasingly robust profit and balance sheet. It paid $140m of cash dividends to shareholders in April this year after reporting solid profit growth and a strong outlook because of a boom in house building and building materials sales. NZME and Fletcher Building are just two among many large and small New Zealand companies that have refused to repay the cash, despite reporting profit growth and higher cash reserves."
https://www.interest.co.nz/public-policy/116888/bernard-hickey-argues-20b-covid-cash-should-be-returned-taxpayers-along-20b?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Tuesday+26+ July+2022

You know when I first came to NZ 20+ years ago I thought; small country = easier to implement BETTER policies than the larger countries ; more remote from other major trading nations = less negative influence, etc.

The gov't handout of $$ directly to companies was never a good thing. They don't do it that way in Canada where the subsidy payments are only given to the individual. When I see the NZ subsidy payment system where the EMPLOYER is filing the application for their EMPLOYEEs.... I knew this would be nothing but a freebee handout to the benefit of the corporations. In America, individuals there received a cheque (even more decentralised compared to Canada where the individual's tax return is tied to the subsidy payment; which on most part is received directly into their bank account). US has a similar model tied to the individual's tax return. If they earn more than $90K (if I recall correctly that figure), then they receive no Coivid cheque payment. Why did our NZ gov't not have the smarts or knowledge to see that companies in NZ would take advantage of the situation? All this trying to do things different because we are NZ only hurts us more. Can't reinvent the wheel enough times to make a statement.

[SBQ]

Oh I should add, one of the wishes I look for in the NZ gov't is to truly implement a capital gains tax. We need to align our taxation that is similar to Australia, Canada, US, etc. Throw out FIF and start taxing assets AT TIME of disposal. The more closely we tax in the same way as in other western nations, the less distortions and (evasion?) will happen.

[Aaron]

I am confused the Sapere report on taxes and the wealthy concluded

households earning more than $500,000 a year would have an effective tax rate of 29% to 31%, if they were not receiving NZ Super. An older retired couple living in their own home with the same level of economic income had an effective tax rate of 6%..

Not sure what the last sentence means, but do they mean the wealthy claw back their tax in old age through national superannuation?

https://www.stuff.co.nz/business/300855444/how-much-tax-are-highincome-people-really-paying

The IRD and David Parker have concluded

high wealth families pay a median effective tax rate of just 8.9%, as they earn significant income from untaxed capital gains.

Bit of a gap between 29% and 9%.

OliverShaw principal Robin Oliver, former deputy commissioner of policy at Inland Revenue, said the [sapere] report was commissioned out of concerns about the methodology of the Government’s work, which he said could give a misleading picture of the tax system.

Treasury also came up with 12%. I assume the difference between Sapere and IRD is ignoring capital gains.

Sapere also notes.

People earning between $70,000 and $180,000, 18.8% of all taxpayers, paid 42% of all tax. The 2.4% of people earning more than $180,000 a year paid 26.6% of all tax.

So the wealthy can always threaten to leave NZ, hopefully they do not have too much in real estate as this is not that portable. Most manufacturing has already left.

Scary that so few people pay so much of the tax. 50% probably pay nothing after you take into account health, education, roads etc.

Also scary that so few people hold so much of the wealth and income in NZ and this has been a trend that has got a lot worse under Labour.

Maybe we should take the word "fair" out of the debate and focus on what might work best. Personally I do not think ignoring capital gains is right hence starting this thread in 2011. 12 years and another report and still no closer to a capital gains tax.

I did not read Michael Cullens report on capital gains tax but understand it included few concessions such as lower tax rates for capital gains. Start with something simple and palatable to the boomers and crank it up as time goes on.

GST has increased 50% since it came in, in 1986 and that is a regressive tax.

[Panda-NZ-]

GST has increased 50% since it came in, in 1986 and that is a regressive tax.


In exchange for other tax cuts (with less going to the poor as usual).

NZ could do a tax free threshold in exchange for a 15% CGT. Have an accounting firm sign off on the fiscal neutrality of the plan.

[iceman]

In exchange for other tax cuts (with less going to the poor as usual).

NZ could do a tax free threshold in exchange for a 15% CGT. Have an accounting firm sign off on the fiscal neutrality of the plan.

You could just do it by scrapping WFF at the same time. No need to have 2 tax systems doing effectively the same as WFF effectively creates a tax fee threshold for working families, albeit a very inefficient way of doing so.

[fungus pudding]

You could just do it by scrapping WWF at the same time. No need to have 2 tax systems doing effectively the same as WWF effectively creates a tax fee threshold for working families, albeit a very inefficient way of doing so.

World wide fund! Where does animal welfare come into it?

[BlackPeter]

World wide fund! Where does animal welfare come into it?

I was wondering that as well, but he probably wanted to write WFF - Working for families :) ;

[iceman]

World wide fund! Where does animal welfare come into it?
They’re actually called World Wildlife Fund !

[SBQ]

@Aaron: The problem is income is not defined to include capital gains. I've been pounding the table that there's a huge difference on where capital gains are derived from, by NZ resident. The biggest out-liar is the ownership of multiple houses, while those in Kiwi Saver that choose to make an ownership in overseas shares, are paying tax on the capital gains under FIF, every year (but conveniently no credit on CG LOSS on years like last year). Why does the working class and those on lower incomes, are only left with a tax paying scheme called Kiwi Saver (which also is hit with management fees), while those that could leverage in buying another house or rental property (because they have excess incomes and the bank will allow them to), gets away with tax free capital gains if such houses are held for more than 10 years?

The tables need to be turned around and if I have not mentioned many times before, IRD needs a hard look at what Canada has done. Justin Trudeau has done a lot more for the working class in this area than any previous NZ PM has done. I'll repeat, the disadvantaged (those on disabilities mental and physical) get the better tax advantage, likewise with those wanting to save for education when the child is born, or a TFSA for ALL residents over age 18 ; ALL of these plans with the incentive to save and invest as it grows 100% tax free. At any moment the wealthy choose to buy houses as rental income, then the full force of taxation will apply to them. There is no differentiation on capital gains if derived from houses or from the stock market. But in NZ we seem to have a very very strong preference of leaving out houses as part of the taxable take. If there are so many that are leaving NZ for Australia, I can completely understand why because to me it seems the working class, teachers, nurses, etc are getting a bad deal by living in NZ (as the wealthy that participate in owning more and more houses, distort the housing prices in NZ).

There is so much wrong in NZ that politicians here don't want to address. Last week the JW knocked on my door and I gave them an earful in regards that the people in NZ have better things to be concerned about than some faith based religion they're spread about.

[Panda-NZ-]

I wish hipkins would grow a spine.

Luxon gave a very poor response (like he often does when he doesn't get the interview questions in advance)... Almost angry that the wealthy are being made to pay even that

The better response would have been his usual trite "give the peasants an education so they can be one of them" (..or go to Australia on the NZ taxpayer*) but he doesn't have the political skills necessary.

[Balance]

I wish hipkins would grow a spine.

Luxon gave a very poor response (like he often does when he doesn't get the interview questions in advance)... Almost angry that the wealthy are being made to pay even that

The better response would have been his usual trite "give the peasants an education so they can be one of them" *or go to Australia on the NZ taxpayer* but he doesn't the political skills.

Panda-nZ, the ignoramus peasant who wanted Ryman to load up with more debt to do a share buyback when it was close to defaulting on its loans.

[SBQ]

Panda-nZ, the ignoramus peasant who wanted Ryman to load up with more debt to do a share buyback when it was close to defaulting on its loans.

That's interesting. Are you saying Ryman Health (the NZ senior retirement homes I see around NZ) has borrowed $$ to finance a share buy back ? Wow.. .and I think investors in NZ were so thick in the head demand dividends over increase the share price of the company.

Anyways, Luxon is no real executive despite having managed Air NZ. I often find he has similar parallels to Donald Trump in having minimal gov't experience.

[davflaws]

That's interesting. Are you saying Ryman Health (the NZ senior retirement homes I see around NZ) has borrowed $$ to finance a share buy back ? Wow.. .and I think investors in NZ were so thick in the head demand dividends over increase the share price of the company.

Anyways, Luxon is no real executive despite having managed Air NZ. I often find he has similar parallels to Donald Trump in having minimal gov't experience.

Balance resorts to "cut and paste" trolling whenever he is faced with an argument he can't counter or a political opinion anywhere left of Ghengis Kahn. If you track his posts on this and the Off Market Discussions" forum, you will note that his standard response to many posters is an ad hominem rant. Sadly, this behavior has started to spill over into the OCA thread on the NZX forum.

I suggest you stop feeding him.

[Panda-NZ-]

A poem about tall poppies written by chat gpt:

I told it that the premise is where if the poppy is cut down it provides sun and fertiliser for the other poppies, but if it is not then it succumbs to genetic heritable diseases and then soon dies anyway.




Poppies and fate.

In a field of poppies tall and fair,
A story's told of life's despair,
Of growth and strife,
the fates entwined,
And choices made, by fate's design.

The tallest poppy, proud and grand,
Stood tall above the earthen land,
Its petals kissed by sun's embrace,
A sight of grace, a touch of fate.

But in this tale of heights and dreams,
The tallest poppy's not what it seems,
For though it soars, its doom awaits,
A twist of fate, a darkened fate.

If cut down swift by hand or fate,
The tallest poppy meets its fate,
Yet in its fall, a gift bestows,
A sunlit path, a nourished growth.

The poppies near, by sun and soil,
Embrace the gift, their roots to coil,
And from demise, new life awakes,
A cycle old, a dance of fate.

But if untouched, the poppy stays,
Its height maintained, its pride displayed,
A heritable curse, it bears instead,
In time, succumbs, and withers dead.

This tale of poppies, tall and fair,
Reminds us all of life's despair,
Yet even in the darkest days,
We find a way, a light to blaze.

- Chat GPT 4.0

[Bjauck]

A poem about tall poppies written by chat gpt:

I told it that the premise is where if the poppy is cut down it provides sun and fertiliser for the other poppies, but if it is not then it succumbs to genetic heritable diseases and dies soon anyway.
The tallest poppies gave their lives for others. So the rest of us could thrive. Lest we forget.

[Aaron]

Rod Duke in the herald this morning about a capital gains tax.

https://www.nzherald.co.nz/business/rod-duke-fears-capital-gains-tax-would-hurt-the-middle-class-other-rich-lister-claims-ird-report-makes-them-look-like-criminals/BHJR27ZQJFBEDIKQRYXBIFCL2Y/

This, he believed, would be “punitive” for hard-working people. “It is not a rich person’s tax,” Duke said, saying it would also catch “thrifty savers” who tried to prepare for the futures of themselves and their children.

Think of the children says Rod, what a community minded patriot.

Not sure but I felt the tax on my labour for a 40 hour week seemed quite punitive especially when the $45,000 I made each year for the last five years just owning an average house did not seem that hard to do. No great skill or effort in having capital and owning an asset (although choosing ones that go up on the NZX has eluded me so far). Not quite sure where he is coming from.

Especially when we have a government guarantee of a 1-3% gain each year in the value of our assets while reducing the cost of our borrowings each year by the same amount and with crazy kaumatua Adrian Orr in charge of the RBNZ we have been getting a lot more than the 2% mandated in legislation. Adrian has been a godsend for the "hard-working" people Rod is so concerned about.

I guess while 60% of NZ owns a house Rod will have some allies in his fight against punitive taxes. Another rich lister felt the suggestion of a capital gains tax made him/her feel like a criminal. Now that is terrible, poor baby.

Another rich lister who did not want to be named said

he made his fortune on untaxed capital gains but supports taxing those gains - saying it was only fair to bring New Zealand into line with other countries.

No wonder he wanted to remain anonymous, I imagine you would get a lot of hate for saying crazy things like that.

I am surprised we have not been threatened with the wealthy taking their capital and leaving NZ yet???

[Panda-NZ-]

he made his fortune on untaxed capital gains but supports taxing those gains - saying it was only fair to bring New Zealand into line with other countries.

No wonder he wanted to remain anonymous, I imagine you would get a lot of hate for saying crazy things like that.


The taxpayer's union, which actually supports non-taxpayers, would be onto him at a minimum. :p

[777]

I am surprised we have not been threatened with the wealthy taking their capital and leaving NZ yet???

That will happen for sure. The leaving that is, not the threat.

[Panda-NZ-]

That will happen for sure. The leaving that is, not the threat.

Then pay a CGT in their destination country & maybe even more. nice.

[Balance]

That will happen for sure. The leaving that is, not the threat.

Unlike other countries, almost all the wealthy in NZ already have substantial assets & wealth in places like Australia. In fact, most of them spend a great of their time overseas.

An easy hop and it's Australia residence for them - just as so many doctors and young skilled NZers have done in the last 5 years.

A lot will depend on what type of CGT is brought in. The one proposed by Michael Cullen (he hated the rich with a vengence) will see them take their funds and wealth over to Australia.

IMO, a CGT is well overdue in NZ so let's stop mucking around and bring a sensible one in.

[Panda-NZ-]

Australia's CGT is 20% (but only if you held the asset for 12 months). Red tape!

Otherwise it's 45% and you're on the highest tax rate.

[Aaron]

A lot will depend on what type of CGT is brought in. The one proposed by Michael Cullen (he hated the rich with a vengence) will see them take their funds and wealth over to Australia.

IMO, a CGT is well overdue in NZ so let's stop mucking around and bring a sensible one in.

I don't remember the details but I think Michael Cullen missed an opportunity by not proposing a simple across the board CGT but at lower rates than the taxes on labour, just to make it palatable.

Michael Cullen came across as a whiny dweeb while in opposition, but once in power he at least tried to address bigger issues such as the affordability of national superannuation. The Cullen fund was an attempt at current generations putting something aside for their own retirement and kiwisaver compelled the next generation to start saving for their own retirement.

I liked his comment "I don't mind people climbing the ladder of success but I do not like it when they try to kick out the rungs of that ladder once at the top" or something to that effect.

[Aaron]

That will happen for sure. The leaving that is, not the threat.

Usually it is just the threat, but you never know.

[dobby41]

Unlike other countries, almost all the wealthy in NZ already have substantial assets & wealth in places like Australia. In fact, most of them spend a great of their time overseas.

An easy hop and it's Australia residence for them - just as so many doctors and young skilled NZers have done in the last 5 years.

A lot will depend on what type of CGT is brought in. The one proposed by Michael Cullen (he hated the rich with a vengence) will see them take their funds and wealth over to Australia.

IMO, a CGT is well overdue in NZ so let's stop mucking around and bring a sensible one in.

The only proper CGT is to tax ALL capital gains (with a threshold for the family homes (maybe $1mil per owner)).
Wide-ranging and simple.
The only sticky point is establishing the value of the assets at the start but that is a one-off issue.

I find it laughable that people suggest people will leave if one is introduced - maybe go to Aus where they have GCT and stamp duty.

[SBQ]

The only proper CGT is to tax ALL capital gains (with a threshold for the family homes (maybe $1mil per owner)).
Wide-ranging and simple.
The only sticky point is establishing the value of the assets at the start but that is a one-off issue.

I find it laughable that people suggest people will leave if one is introduced - maybe go to Aus where they have GCT and stamp duty.

and like all other 'similar' countries to NZ (English speaking) that have CGT, they ALSO have CGL (LOSS). In Canada you can claim back the tax you paid on CGT with a future CGL which averages out the gains. Unlike NZ's FIF, they are only worried about the paper gains and not the losses of 1 year to another.

Warren Buffet has the same view that he's flabbergasted on the though of the wealthy and rich fleeing America. His view is you're already rich, why be so greedy? and if moving would ever satisfy anything ; i'm amazed the amount of great effort multi-millionaires go through to pay the least amount of taxes when any savings would have little or no benefit to the overall outcome of their standard of living.

[Panda-NZ-]

Warren Buffet has the same view that he's flabbergasted on the though of the wealthy and rich fleeing America. His view is you're already rich, why be so greedy? and if moving would ever satisfy anything ; i'm amazed the amount of great effort multi-millionaires go through to pay the least amount of taxes when any savings would have little or no benefit to the overall outcome of their standard of living.


The US still has an inheritance tax too (although a weak one).

If they actually enforced their own tax laws they would be overall more progressive than NZ esp with no sales tax.

[nztx]

Dont think there will be much in way of reductions in any other taxation if a CGT ever got brought in

Look back no further to the same Labour's non performances on promises following introduction of GST

All smoke, mirrors and grandiose lies ;)

And who does Dozy Parker expect to swallow the convenient widened theory that capital gains of any sort form income ? ;)

Surely the sharp tax collectors can't have been doing their job right if Comrade Dozy's tax rate claims come out well south of the lowest effective tax rates in play for the selected band of wealthy examples .. ;)

We might need thousands more Accountants, Valuers and Civil Service bods to deal with all the extra red tape on an even more poorly concocted excuse for CGT.

A poorer excuse for a Labour Govt will have even less of a clue on how it should operate than last time they tried spinning the same wheel only to be left looking idiots ..

Is Mahoota available to start the drafting job for the hapless Dozy Parker's attempt to respin the last failed CGT wheel ? ;)

The CGT stance is likely to quite nicely turn around and see most of the peasants on the street also bitten badly on the backside whether they realise it or not ;)

Almost as good as Robbo trying to tell everyone that some Interest expense is not a business expense
against all prevailing principles.. ;)

Look where that went and who wound up mostly on the paying end for those changes ;)

These sort of weird and wonderful inspirations can always be expected from the Socialist comrades of the
failed Desperado cause headed for the exit door very soon, but not awake enough to see that they are signing their exit visa's in even retracing back to past badly failed attempts ;)

Everything is fine and dandy in trying to slingshot in more of the private wealth on any old poor excuse to cover the gaps in the Govt's haphazard and excessive path of wasteful squandering and consultants to cover for their own total lack of clues ;)

A Labour thing - isn't it ? .. and probably yet another failed one :)

[ValueNZ]

I'm not in favour of a CGT because I believe that the allocation of resources done by individuals is going to be far more efficient than what the government would be able to do. In the long term, all New Zealanders are going to be better off with the extra investment done by wealthy individuals without a CGT, than the benefit some may receive with a CGT.

"I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle."

[fungus pudding]

I'm not in favour of a CGT because I believe that the allocation of resources done by individuals is going to be far more efficient than what the government would be able to do. In the long term, all New Zealanders are going to be better off with the extra investment done by wealthy individuals without a CGT, than the benefit some may receive with a CGT.


Roger Douglas put it so succinctly, 'Im against CGT because it stops things happening'.

[Panda-NZ-]

I'm not in favour of a CGT because I believe that the allocation of resources done by individuals is going to be far more efficient than what the government would be able to do. In the long term, all New Zealanders are going to be better off with the extra investment done by wealthy individuals without a CGT, than the benefit some may receive with a CGT.

"I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle."

The private sector is heavily in debt.. the NZ govt has an AA+ credit rating, enough said.

[Balance]

The private sector is heavily in debt.. the NZ govt has an AA+ credit rating, enough said.

Ignoramus Labour peasant panda-nz - tell us about you wanting Ryman to load up with more debt to do a share buyback when it was close to debt default.

[ValueNZ]

The private sector is heavily in debt.. the NZ govt has an AA+ credit rating, enough said.
Funny how a decade of loose monetary policy incentivises firms to take lots of debt on, isn't it? The governments ability to repay debt on time is by no means an indicator of its ability to efficiently allocate resources. Private institutions are driven by profit, meaning where its necessary firms will enter and exit markets. What are government employees incentivised by?

[Panda-NZ-]

Ignoramus Labour peasant panda-nz - tell us about you wanting Ryman to load up with more debt to do a share buyback when it was close to debt default.
Ryman is heavily in debt yes.. as are many businesses and consumers. The govt though, not so much.

[777]

Ryman is heavily in debt yes.. as are many businesses and consumers. The govt though, not so much.

You really live in another universe.

[Panda-NZ-]

You really live in another universe.

One with facts and figures in it.

An AA+ credit rating and looking relative to the international environment (where everyone has taken the same approach).

[Balance]

You really live in another universe.

It’s ok - let him post the garbage which comes from the Labour Party.

Helps the electorate out there know what kind of clowns are in the Labour Party.

[ValueNZ]

One with facts and figures in it.

An AA+ credit rating and looking relative to the international environment (where everyone has taken the same approach).
Like I said before, a high credit rating for the government does not mean they would be able to spend the capital gains tax dollars better than individuals would.
Also Balance, lets attack the arguments rather than the people

[nztx]

The private sector is heavily in debt.. the NZ govt has an AA+ credit rating, enough said.


So taxing the backsides off the Private Sector just so the Central Govt bureaucracy can blunder on in wasteful squandering is the answer ? ;)

Very soon the AA+ buckles when those being harvested are no longer harvestable :)

It all sounds like a dumb shortsighted Socialist scheme for killing the golden goose ..

Only a Dumb Socialist would try revisiting past history, rejection of the idea and previous
failed CGT initiatives few on the front bench knew how they would operate :)

There is a whole Labour front bench of that sort of desperate deficient talent ..

[Panda-NZ-]

So taxing the backsides off the Private Sector just so the Central Govt bureaucracy can blunder on in wasteful squandering is the answer ? ;)


It's often the other way around, they will be cap in hand to the govt after any disaster.. GFC corona, earthquake, flooding etc.

[nztx]

It's often the other way around, they will be cap in hand to the govt after any disaster.. GFC corona, earthquake, flooding etc.


The Bureaucracy have spent how many hundred years firmly attached to the tit of private sector and private enterprise sucking away ? ;)

Without it they would wither and die - would they not - peasant friend ? ;)

You like South America - say Costa Rica ?

Many peasants there and smart money all run away :)

If Comrade Parker wants to start poking the tigers at large, then he and his incompetent mates risk get badly bitten or savaged yet again - surely ? ;)

It wouldn't be the first time an incompetent mob of Labour nincompoops have tried their luck and paid a price for their stupidity :)

[Panda-NZ-]

The Bureaucracy have spent how many hundred years firmly attached to the tit of private sector and private enterprise sucking away ? ;)

Australia has a huge staff of public servants, America too (state + local).

UK tried to trim theirs but it didn't work out too well and NHS is a disaster.

The focus should be on real issues not worn out talking points and agenda's from the 1980s.

[nztx]

Australia has a huge staff of public servants, America too (state + local).

UK tried to trim theirs but it didn't work out too well and NHS is a disaster.

The focus needs to be on real issues not worn out talking points and agendas from the 1980s.


Most would doubt Labour's ability to focus or deliver on anything after the long list of recent FAIL performances

How many extra bums planted on Civil Service seats added under this mob's watch ?

How much extra thrown at Consultants to make up for the large void within Govt ranks ?


Their incompetence with existing Tax forms should make all concerned about their abilities in wanting to syphon even more on any old poor excuse.

That allays any look over the fence at what is going on next door .. in attempts to justify their backwards focussed
attention and poor attainment on what was in their hands, surely :)


Feel like being made poorer ? -

https://www.nzherald.co.nz/business/bruce-cotterill-envy-taxes-will-only-result-in-making-us-all-poorer/XO73TB35FZGXVFRJIVB3MOOBU4/

Bruce Cotterill: Envy taxes will only result in making us all poorer

This is what Comrade Parker is hell bent on delivering ;)


Feel poorer already on Cost of Living, Interest Increases, Disasters, sagging / volatile property & rental markets ?

Parker proposes to deliver to all a newer more comprehensive form of "Poorer" to eclipse what they have
already inflicted on all ;)

Only the idiots and or those in a long deep sleep out there could fail to see it :)

[fungus pudding]

Most would doubt Labour's ability to focus or deliver on anything after the long list of recent FAIL performances

How many extra bums planted on Civil Service seats added under this mob's watch ?

How much extra thrown at Consultants to make up for the large void within Govt ranks ?


Their incompetence with existing Tax forms should make all concerned about their abilities in wanting to syphon even more on any old poor excuse.

That allays any look over the fence at what is going on next door .. in attempts to justify their backwards focussed
attention and poor attainment on what was in their hands, surely :)


Feel like being made poorer ? -

https://www.nzherald.co.nz/business/bruce-cotterill-envy-taxes-will-only-result-in-making-us-all-poorer/XO73TB35FZGXVFRJIVB3MOOBU4/

Bruce Cotterill: Envy taxes will only result in making us all poorer

This is what Comrade Parker is hell bent on delivering ;)


Feel poorer already on Cost of Living, Interest Increases, Disasters, sagging / volatile property & rental markets ?

Parker proposes to deliver to all a newer more comprehensive form of "Poorer" to eclipse what they have
already inflicted on all ;)

Only the idiots and or those in a long deep sleep out there could fail to see it :)

Why not post the entire article?

[Bjauck]

The only proper CGT is to tax ALL capital gains (with a threshold for the family homes (maybe $1mil per owner)).
Wide-ranging and simple.
The only sticky point is establishing the value of the assets at the start but that is a one-off issue.

I find it laughable that people suggest people will leave if one is introduced - maybe go to Aus where they have GCT and stamp duty. Why not exempt business and shares instead. After all they directly provide taxable income.

People will continue to head overseas for better paid work and affordable housing. Reform would need to be major and extend beyond just introducing a typical OECD CGT exempting the principal residence to change that.

[westerly]

Roger Douglas put it so succinctly, 'Im against CGT because it stops things happening'.

"Certainly not to improve government services and improve outcomes - because everything has gone backwards into crises with Ardern:" Balance

Housing
Healthcare
Education
Poverty
Law & Order
Infrastructure

Balance's list of areas of concern can be traced back directly to Douglas and Richardson' free market policies.

westerly

[ValueNZ]

"Certainly not to improve government services and improve outcomes - because everything has gone backwards into crises with Ardern:" Balance

Housing
Healthcare
Education
Poverty
Law & Order
Infrastructure

Balance's list of areas of concern can be traced back directly to Douglas and Richardson' free market policies.

westerly
Free markets have pulled billions of people out of poverty, worldwide. The amount of tax dollars our government receives and spends is ludicrous when you consider just how poorly government is at allocation of capital, a CGT would only further this.

[SBQ]

The US still has an inheritance tax too (although a weak one).

If they actually enforced their own tax laws they would be overall more progressive than NZ esp with no sales tax.

At least over 95% of the US population does not pay much in inheritance tax as the threshold starts where the estate is valued MORE than $11 MILLION USD. It's not an issue of 'a weak one' or enforcement but the intention is clear, unlike NZ, the ultra rich do pay more taxes in America. (or at least the difference isn't as remarkable as here in NZ where the #1 preferred investment is owning multiple houses that have tax free capital gain).

[SBQ]

Free markets have pulled billions of people out of poverty, worldwide. The amount of tax dollars our government receives and spends is ludicrous when you consider just how poorly government is at allocation of capital, a CGT would only further this.

So please explain why developed top 10 OECD nations that DO have a CGT, are whipping the pants off NZ in terms of standard of living, health care, & education? Let me tell you the main difference. Those nations have the wealthy pay far more taxes than the working class and they put it into more productive assets (ie owning shares of businesses instead of houses). We have taxation under Kiwi Saver that punishes the working class ; while those that could earn in excess were able to leverage and borrow to buy more and more rental houses (which grows tax free); yes ONLY in NZ this is the kind of arrangement we have.

I reiterate, why is Australia, Canada, and America leaving us behind? You will not attract any high skilled migrants to NZ if the environment here is too difficult to prosper. The table needs to be turned around so that the perks of tax free capital gains (over a FIF taxation under KS) is abolished. Really this is a fundamental reason that even the UN has criticised NZ for allowing such a wealth gap between the haves (those owning houses) vs the have nots (those that can't afford their 1st home).

[ValueNZ]

So please explain why developed top 10 OECD nations that DO have a CGT, are whipping the pants off NZ in terms of standard of living, health care, & education?
SBQ, thats correlation vs causation. New Zealand has a massive problem as it stands with excessive government spending, a CGT would only cause more wasteful spending. If your argument instead was to lower other taxes and cover that with a CGT, that would be more reasonable in my view.

The real solution to the housing bubble is to make it far easier for property developers to build housing by getting rid of red-tape legislation, not by slapping them with a CGT upon sale of their new property.

[Balance]

SBQ, thats correlation vs causation. New Zealand has a massive problem as it stands with excessive government spending, a CGT would only cause more wasteful spending. If your argument instead was to lower other taxes and cover that with a CGT, that would be more reasonable in my view.

The real solution to the housing bubble is to make it far easier for property developers to build housing by getting rid of red-tape legislation, not by slapping them with a CGT upon sale of their new property.

Well said, ValueNZ. We have a government addicted to wasteful spending with no accountability for outcomes. Eg. $1 billion for consultants and the $3 billion Provincial Growth Fund - money down the dunny.

There is no point adding on new taxes like CGT for the government to take in more money to waste.

Makes good sense however if a CGT is implemented in conjunction with a comprehensive revamp of NZ’s tax system.

Enjoy this 2 minute video of Kerry Packer taking the Australian government to task over new laws and new taxes:

https://youtu.be/DBg7DnQjjcY

[Balance]

As for housing, the solution is simple - just adopt Singapore’s housing policy.

[iceman]

Why not post the entire article?

That would be in breach of both Sharetrader & NZ Herald subscription rules.

[Bjauck]

SBQ, thats correlation vs causation. New Zealand has a massive problem as it stands with excessive government spending, a CGT would only cause more wasteful spending. If your argument instead was to lower other taxes and cover that with a CGT, that would be more reasonable in my view.

The real solution to the housing bubble is to make it far easier for property developers to build housing by getting rid of red-tape legislation, not by slapping them with a CGT upon sale of their new property.
NZ government spending as percent of GDP is similar to that of Australia and the USA and below most of Europe. Some wasteful spending happens the world over. Where the governments raise their revenue varies if course, NZ has a regressive revenue raising system with the middle income earners paying a greater percent of their income as tax than the wealthy. Perhaps that is holding NZ back.

[iceman]

NZ government spending as percent of GDP is similar to that of Australia and the USA and below most of Europe. Some wasteful spending happens the world over. Where the governments raise their revenue varies if course, NZ has a regressive revenue raising system with the middle income earners paying a greater percent of their income as tax than the wealthy. Perhaps that is holding NZ back.
Our very lacklustre productivity as a country which reflects the huge proportion of Kiwis that don’t contribute at all, is the biggest issue. Then we have our low goals. No European country would pride themselves of being able to make stuff with No8 wire for example !

[Bjauck]

Our very lacklustre productivity as a country which reflects the huge proportion of Kiwis that don’t contribute at all, is the biggest issue. Then we have our low goals. No European country would pride themselves of being able to make stuff with No8 wire for example ! We use no. 8 wire because our capital goes into buying the expensive land!

Lack of productivity gain reflects the fact that NZ does not invest to improve it, and our tax system and investment priorities do not encourage us to invest to increase it. So many of our more productive kiwis go to Australia where they work more productively than they could in NZ and where their after tax income can provide a much better lifestyle.

[iceman]

We use no. 8 wire because our capital goes into buying the expensive land!

Lack of productivity gain reflects the fact that NZ does not invest to improve it, and our tax system and investment priorities do not encourage us to invest to increase it. So many of our more productive kiwis go to Australia where they work more productively than they could in NZ and where their after tax income can provide a much better lifestyle.

We agree. They work more productively over there because Australia takes advantage of their abundant natural resources. We don’t.

[Aaron]

The real solution to the housing bubble is to make it far easier for property developers to build housing by getting rid of red-tape legislation, not by slapping them with a CGT upon sale of their new property.

A CGT won't change anything for property developers their income on which they are taxed would be considered capital gain for the rest of us.

Admittedly govt debt has doubled over the last few years and it is hard to see that anything substantial has come from it.

Tax rates don't need to rise with a CGT we could offset it by dropping GST or income taxes. Maybe if we had a CGT everyone would be paying roughly 20%.

[Aaron]

Why not post the entire article?

Cause it is a load of crap. Bruce just says much what you would say. Envy tax, tall poopy syndrome, without the wealthy society would collapse, they are the wealth generators and job creators if you bring in a CGT and they will leave and NZ will collapse.

Interesting that Bruce provides opinions on how to run the country on a regular basis in the herald. I am not sure how long has he been chairman of Asset Plus but if that is the best he can do for one of the smallest simplest companies on the NZX I do not know how he would go managing a country of 5million. I imagine centuria appoints the board and have done OK along with the board of directors over the years but the plebs look like they have had their wealth halved under Bruce's leadership. I don't really know if this is true but play the man not the ball as I always say.

He did not let us down in the article though, he finished with the quintessential threat of leaving and taking his wealth with him. What a co*k. Although to look at his CV I am being unfair and he does a hell of a lot for NZ. Maybe just spread himself too thin to provide better governance at APL.

Last time I looked it was motivated hard working young people leaving NZ for opportunity abroad rather than the rentiers who are firmly entrenched and fighting hard to keep their comfortable position.

[dobby41]

As for housing, the solution is simple - just adopt Singapore’s housing policy.

They are having issues with rapidly rising prices so have increased the stamp duty heaps.
60% if you are a foreign buyer, 20% for a 2nd house, 30% for a 3rd.

[Balance]

They are having issues with rapidly rising prices so have increased the stamp duty heaps.
60% if you are a foreign buyer, 20% for a 2nd house, 30% for a 3rd.

Yup - a mechanism which they adjust up and down to effect the outcome they want especially in the higher end private residential property market.

In 2021, 80 percent of the resident population in Singapore lived in public housing developed by the Housing and Development Board (HDB). Every Singaporean adult is guaranteed a home under their public housing scheme which was adopted from the UK in the 1960s but vastly improved to meet the needs of Singaporeans.

[SBQ]

A CGT won't change anything for property developers their income on which they are taxed would be considered capital gain for the rest of us.

Admittedly govt debt has doubled over the last few years and it is hard to see that anything substantial has come from it.

Tax rates don't need to rise with a CGT we could offset it by dropping GST or income taxes. Maybe if we had a CGT everyone would be paying roughly 20%.

Simple question which again, relates to what I posted before. How do other developed countries that have a comprehensive CGT, become far more productive and whipping NZ in increasing the standard of living? Specifically, why are houses more affordable in those countries? I will tell you why. It's because there are too many property speculators that have turned housing, into a game of trading shares of a company. They've commoditised houses where the losers are those that can't afford to buy one but are forced to pay the price. We have insane high land prices where the infrastructures are paid for privately instead of co-funded with the gov't. High levels of regulations 'Green Party' environmental restrictions, lists goes on. We're heading really fast to where we will be living in tents.

[Aaron]

Sorry behind the pay wall but Sir Ian Taylor risks missing out on invites to flash parties with his blasphemy on tax.

https://www.nzherald.co.nz/business/sir-ian-taylor-opinion-lets-talk-about-tax-baby/4FESMB6CL5CIVLJC2JND4ZWNIE/

He suggests a capital gains tax would be a good idea and might pave the way to reduce GST to help those most in need.

I agree with him taxing unrealised capital gains is a bad idea and agree taxing realised capital gains should start asap.

He also mentioned that when trying to help a couple of Swedish employees to get taxed in NZ as Sweden had a higher tax rate they declined as they were proud to pay taxes in their country. They did not see it as a burden but part of their social contract.

Perhaps they needed to talk with David Seymour who could point out that the success of their country was probably due to low tax rates in the 1860s. David obviously a deep thinker as most of us would have not realised this.

[JBmurc]

Sorry behind the pay wall but Sir Ian Taylor risks missing out on invites to flash parties with his blasphemy on tax.

https://www.nzherald.co.nz/business/sir-ian-taylor-opinion-lets-talk-about-tax-baby/4FESMB6CL5CIVLJC2JND4ZWNIE/

He suggests a capital gains tax would be a good idea and might pave the way to reduce GST to help those most in need.

I agree with him taxing unrealised capital gains is a bad idea and agree taxing realised capital gains should start asap.

He also mentioned that when trying to help a couple of Swedish employees to get taxed in NZ as Sweden had a higher tax rate they declined as they were proud to pay taxes in their country. They did not see it as a burden but part of their social contract.

Perhaps they needed to talk with David Seymour who could point out that the success of their country was probably due to low tax rates in the 1860s. David obviously a deep thinker as most of us would have not realised this.

Should have had Cap gain realised tax back when Helen clark was in office ..could well see very little in the way in CAP gains for the rest of this decade ...if not more so Cap losses ..well till rates drop and property mad kiwi's go back in boots in all..

[dobby41]

Another smart person believes that we should have a CGT - Sir Ian Taylor

https://www.nzherald.co.nz/business/sir-ian-taylor-opinion-lets-talk-about-tax-baby/4FESMB6CL5CIVLJC2JND4ZWNIE/

[nztx]

Another smart person believes that we should have a CGT - Sir Ian Taylor

https://www.nzherald.co.nz/business/sir-ian-taylor-opinion-lets-talk-about-tax-baby/4FESMB6CL5CIVLJC2JND4ZWNIE/


has anyone asked whether taxing fresh air might be a good idea ? :)

[Aaron]

has anyone asked whether taxing fresh air might be a good idea ? :)

Nothing to tax amongst the political threads. All fetid and stinky.

[dobby41]

has anyone asked whether taxing fresh air might be a good idea ? :)

Probably not but do you think Sir Ian would support that?
Silly idea really!

[nztx]

Probably not but do you think Sir Ian would support that?
Silly idea really!


We all know where the ultimate home of silly ideas is .. where the desks are emptying progressively
as a few wake up to reality :)

[BDL]

Hey dobby, I hear the maori are out of control in labour party. Better watch out, they can be nasty basta*ds....

So much for pushing all things maori, "special people" you know... after all, they only want to take over the country, and just needed silly old Labour to help them along.

Watch your back. Jacinda got stabbed good and proper by the look of it.

[dobby41]

We all know where the ultimate home of silly ideas is .. where the desks are emptying progressively
as a few wake up to reality :)


Hey dobby, I hear the maori are out of control in labour party. Better watch out, they can be nasty basta*ds....

So much for pushing all things maori, "special people" you know... after all, they only want to take over the country, and just needed silly old Labour to help them along.

Watch your back. Jacinda got stabbed good and proper by the look of it.

You know - I thought that this thread was about CGT but neither of you seem to want to discuss that.
Neither comment has anything to do with Sir Ian supporting a CGT.
Keep the politics in the politics thread rather than spray it around!

[GTM 3442]

There doesn't seem to be anything particularly difficult about taxing capital gains.

The ability to tax “deemed income” already exists thanks to the FIF regime – just needs a little tweaking.

You can only tax things which you can easily and readily value. Helpfully there are share registries, rating databases, tax returns, company filings, and the like which allow a valuation to be made and a loss/gain calculated relatively simply.

And of course, the exceptions/exemptions. Helpfully there are many countries with a CGT with exceptions/exemptions, so it’s not a major exercise to pinch an idea or two (or four or more) to suit New Zealand’s undoubtedly “special and unique conditions”.

As with GST, a fairly long period for the Great New Zealand Public to warm to the idea, and a small legion of comms people to sell the idea and the details.

Then you’d need a start date for the valuations – ideally a couple of years in the future.

Administratively it’s not particularly difficult – the source data pretty much already exists, making it an integration exercise as much as anything. Set it up and just wait for the transactions to start ticking over and the money to start rolling in.

And who would you get to do it?

Who better than the Tax Partners at EY, Deloittes or some crowd like that. Pay them five million bucks a head for the detailed design, two new passports in names of their choosing, and a complimentary one-way ticket to anywhere else in the world. And a five million buck bonus payable after three years if it rakes in as much as their design predicted.

[Aaron]

As with GST, a fairly long period for the Great New Zealand Public to warm to the idea, and a small legion of comms people to sell the idea and the details.


Just remembered reading an opinion piece from John Roughgan about capital gains tax. This sentence caught my attention and reminded me how powerful the media is in shaping public opinion.

https://www.nzherald.co.nz/nz/john-roughan-to-tax-or-not-to-tax-or-the-third-rail/MN3WMJAU6BA5BN2ZZM7U4ID3RM/

A new Herald editor had brought me back from Parliament to join the small team that wrote its editorials.
Our editorials were supporting GST, reversing the paper’s previous opposition to a value-added tax whenever one had been recommended by reviews of the tax system. But capital gains tax was a step too far even for Rogernomics at that time.

The paper makes the decision what to support and what to squash.

While looking for the article I came across this one, unrelated to capital gains tax but holy s*it I have not been following the three waters and co-governance debate thinking it is just racist negativity from white people, but no this is crazy stuff, not democratic at all.

https://www.nzherald.co.nz/nz/john-roughan-theres-something-murky-in-the-water-reform/XBGNUIDIKND5BDKBYMKDPVQJYQ/#

Whoever proposed this sort of thing is working hard for two NZs splitting people based on race and giving one race special powers over everyone else. To me this seems like total bull*hit.

I can now see why there seems to be a lot of Maori separatists in parliament, sounds like a good deal for them. If this legislation gets signed into law it will be outrageous.

How we could have people in power promoting and supporting this undemocratic divisive policy is beyond me (unless they are Maori or stupid). No wonder Jacinda left, slow learners like me are just waking up to what is happening in parliament. Stop race based policy.

[GTM 3442]

I don’t think it’ll only be Māori subject to CGT, but I suppose you have to allow for tha vagaries of electoral politics.

[Aaron]

I don’t think it’ll only be Māori subject to CGT, but I suppose you have to allow for tha vagaries of electoral politics.

Sorry got side tracked in the last post, not mixing capital gains and Maori politics.

Saw this click bait but clicked anyway as it discussed the big threat of bringing in a capital gains tax. Not sure how well researched this is or even how they would get that data so take it with a grain of salt, but if there is an element of truth to it Australia a place to go to for millionaries despite capital gains tax. USA has a capital gains tax I think. Israel and Singapore don't know.

The daily digest does not sound like a serious news organisation and is Zeleb.es even a person's name. The joys of the internet and all the **** it produces.

https://www.msn.com/en-nz/news/other/millionaire-migration-where-and-why-rich-people-are-moving-out/ss-AA1aFGHo?ocid=msedgntp&cvid=14db63c2f66746e58d2f02209525db9b&ei=14#image=16

[Aaron]

Good to see Chippy towing the line.

https://www.stuff.co.nz/national/politics/132531178/hipkins-rules-out-wealth-and-capital-gains-tax--end-of-story

Another gutless ineffectual leader kowtowing to the selfish boomer vote. As much as I hate everything else about the greens maybe I will give them my vote based on their tax policy.

Has national still got raising the retirement age to 67 as part of their policy? I assume they have, brave but this will not happen until the last boomer is firmly attached to the taxpayer teat otherwise it is not politically palatable.

Here we go with an article from RNZ.

https://www.rnz.co.nz/news/national/479781/national-party-holds-ground-on-raising-superannuation-age-to-67#:~:text=National's%20Christopher%20Luxon%20has% 20committed,the%20age%20stays%20the%20same.

National's Christopher Luxon has committed to raising the age of superannuation should the party get into power.

The party intends to lift the age of eligibility from 65 to 67, despite a recent report from the Retirement Commission recommending the age stays the same. Luxon said increasing the age would be done gradually and the party was giving people 15-20 years' notice.

Lets work it out, the article was in November 2022 so 15-20 years away would make the youngest boomer 73years old if I am not much mistaken (2037-1964 = 73). The only surprise is that they allowed a few gen xers to join them at the taxpayer trough.

Tertiary education became unaffordable almost immediately after the last boomer graduated.

I am tarring all boomers with the same brush much like a racist does on other issues so my apologies to the people who aren't selfish and do want to invest in NZs future not just your own.

[777]

Aaron your hatred of "boomers" affects your rational thinking.

[Logen Ninefingers]

Chipkins knows a CGT now would kill Labours flagging election chances stone dead, along with the struggling property market. Even more so when National have a suite of ‘property ponzi’ friendly policies ready to implement. Politicians will always be pragmatic realists when their careers are on the line, something that myopic idealists can’t seem to understand.

[Aaron]

Aaron your hatred of "boomers" affects your rational thinking.

I don't really hate boomers (some of them are friends) but I am at a point where more of the same from govt doesn't do it for me anymore. One issue for me is monetary policy and the continuing rise of wealth and income inequality with a smaller percentage of the country capturing more of the wealth and income. It has been happening for a long time.

Being wealthy is not a problem if everyone gets a similar opportunity when they are young, but with the decrease in income tax rates and the rise of regressive GST rates, the abolishment of stamp duty, gift duty. all death and estate taxes as well as no wealth or capital gains tax and now a regressive inflation tax (cost of living tax) it seems to me that we are setting ourselves up for something more akin to a feudal society where your status and success is decided at birth. Maybe a few generations away but I can't see why we would work towards something like that.

Mind you a communist "green" state is also repugnant so I am unsure how I might vote but my pick for this election is that the smaller more extreme parties will do better than usual as National and Labour offer nothing except a safe comfortable retirement for baby boomers, with some of the cost being lumped onto the following generations.

John Key, Jacinda Ardern and now Chippy all have to sing from the same song sheet to get re-elected.

[nztx]

I don't really hate boomers (some of them are friends) but I am at a point where more of the same from govt doesn't do it for me anymore. One issue for me is monetary policy and the continuing rise of wealth and income inequality with a smaller percentage of the country capturing more of the wealth and income. It has been happening for a long time.

Being wealthy is not a problem if everyone gets a similar opportunity when they are young, but with the decrease in income tax rates and the rise of regressive GST rates, the abolishment of stamp duty, gift duty, no wealth or capital gains tax and now a regressive inflation tax (cost of living tax) it seems to me that we are setting ourselves up for something more akin to a feudal society where your status and success is decided at birth. Maybe a few generations away but I can't see why we would work towards something like that.

Mind you a communist "green" state is also repugnant so I am unsure how I might vote but my pick for this election is that the smaller more extreme parties will do better than usual as National and Labour offer nothing except a safe comfortable retirement for baby boomers, with some of the cost being lumped onto the following generations.

John Key, Jacinda Ardern and now Chippy all have to sing from the same song sheet to get re-elected.


Unfortunately Chumpkins only gets to use the song sheets with all the passages and words missing from Ardern's
attempts at trying rewrite it with a fair bit of airhead spin on the fly, before throwing herself off the tight rope :)

[BlackPeter]

...

Another gutless ineffectual leader kowtowing to the selfish boomer vote. As much as I hate everything else about the greens maybe I will give them my vote based on their tax policy.

...

Tertiary education became unaffordable almost immediately after the last boomer graduated.

I am tarring all boomers with the same brush much like a racist does on other issues so my apologies to the people who aren't selfish and do want to invest in NZs future not just your own.

Just curious - how else would you describe yourself, based on this post, other than selfish?

Reminds me at the old joke: Everybody cares only about himself, only me cares about myself.

Let me ensure you, boomers are people like you and I, and the Gauss curve distribution applies for them exactly as for every other generation, race, nationality or gender.

But given that you clearly don't seem to be a boomer (unless you are a masochist as well), I apologize on behalf of your parents, who you clearly describe as some extraordinary selfish ars*holes. These things happen in any generation, but particularly selfish people conceive them this way.

[Aaron]

Just curious - how else would you describe yourself, based on this post, other than selfish?

Reminds me at the old joke: Everybody cares only about himself, only me cares about myself.

Let me ensure you, boomers are people like you and I, and the Gauss curve distribution applies for them exactly as for every other generation, race, nationality or gender.

But given that you clearly don't seem to be a boomer (unless you are a masochist as well), I apologize on behalf of your parents, who you clearly describe as some extraordinary selfish ars*holes. These things happen in any generation, but particularly selfish people conceive them this way.

I don't think I ever said I was not selfish and self centred.

A bit wealthier and I could be voting for ACT these elections rather than leaning left.

I can see why people vote the way they do. I do not have to like it.

That is one of the reasons I can accept being forced to pay tax as I would not willing give anything to anyone.

Ars*hole seems a bit strong to me, perhaps just "selfish and self-centred" would be more appropriate.

Generationally speaking you should read the fourth turning. More theoretical bull but sounds plausible.

Sounds like these things go in cycles so I can't get too upset.

Unraveling
According to Strauss and Howe, the Third Turning is an Unraveling. The mood of this era they say is in many ways the opposite of a High: Institutions are weak and distrusted, while individualism is strong and flourishing. The authors say Highs come after Crises when society wants to coalesce and build and avoid the death and destruction of the previous crisis. Unravelings come after Awakenings when society wants to atomize and enjoy. They say the most recent Unraveling in the US began in the 1980s and includes the Long Boom and Culture War.[2]

Individualism sounds better than selfish or self centred. This is the third turning, according to them and if they are right the fourth turning will be a doozy but fortunately per the authors the Millennial Generation (which they also describe as a Hero archetype, born 1982 to 2004) shows many similar traits to those of the G.I. youth, which they describe as including rising civic engagement, improving behavior, and collective confidence.

[BlackPeter]

...

Generationally speaking you should read the fourth turning. More theoretical bull but sounds plausible.

...


Agree, good book (though terrible reading, but this is another story). Good explanation of one major drivers of history. Read it together with "The Changing World Order" by Ray Dalio - and the development of history appears pretty straight forward.

However - these things are not inevitable for the individual ... you know, anybody can brake out of the negative connotations of their own generation and do useful stuff instead of moaning about others ... no matter whether this other is a different generation, a different race or a different nationality.

Anybody can change themselves, but nobody can change anybody else, which means that generalisations (in this case "the boomers") are not just wrong (as any generalisation), but as well absolutely pointless.

[Aaron]

Agree, good book (though terrible reading, but this is another story). Good explanation of one major drivers of history. Read it together with "The Changing World Order" by Ray Dalio - and the development of history appears pretty straight forward.

Good book but you obviously do not agree with their conclusions. I take things with a grain of salt when it is a theory but they suggest people are at least partly shaped by the era and turning they were born into, for example. I have highlighted the bits I think you will find most annoying.

Prophet (Idealist) generations enter childhood during a High, a time of rejuvenated community life and consensus around a new societal order. Prophets grow up as the increasingly indulged children of this post-Crisis era, come of age as self-absorbed young crusaders of an Awakening, focus on morals and principles in midlife, and emerge as elders guiding another Crisis. Examples: Transcendental Generation, Missionary Generation, Baby Boomers.[55]

I hope the Hero Millenials aren't pushed into fighting another war by the selfish(individualistic) boomers

[Daytr]

Aaron, sounds like an interesting read. Thanks for the referral.

[BlackPeter]

Good book but you obviously do not agree with their conclusions. I take things with a grain of salt when it is a theory but they suggest people are at least partly shaped by the era and turning they were born into, for example. I have highlighted the bits I think you will find most annoying.

Prophet (Idealist) generations enter childhood during a High, a time of rejuvenated community life and consensus around a new societal order. Prophets grow up as the increasingly indulged children of this post-Crisis era, come of age as self-absorbed young crusaders of an Awakening, focus on morals and principles in midlife, and emerge as elders guiding another Crisis. Examples: Transcendental Generation, Missionary Generation, Baby Boomers.[55]

I hope the Hero Millenials aren't pushed into fighting another war by the selfish(individualistic) boomers

Actually, I thought the theory is quite convincing. What I don't agree with are generalisations like "the boomers".

But, given the thread title we probably pushed that far enough ... and don't forget - given that the boomer generation are with or without the book the leaders in the current crisis situation (just look at the main political players these days) - better don't trample too much over them! You don't want to distract your leaders, they better focus on setting up a good foundation for the next saeculum, otherwise we all are screwed!

[justakiwi]

Oh ****. I guess I had better add "selfish, individualistic boomer" to the list of undesirable JAK traits then. Between you and my buddy Balance, that list is getting longer by the day.


....by the selfish(individualistic) boomers

[Aaron]

Oh ****. I guess I had better add "selfish, individualistic boomer" to the list of undesirable JAK traits then. Between you and my buddy Balance, that list is getting longer by the day.

OK Boomer.

I imagine Balances insults are personal but mine are across a whole generation so don't take it personally you might be one of the good unselfish boomers that Blackpeter says might exist.

[Aaron]

Tried reading the sports pages to avoid the depression brought on by all the other news but then read that Marc Ellis is looking to leave NZ. I think he has done quite well for himself not sure if you could say "rich". But it is not the unimaginable thought of a capital gains tax driving him from these shores it is

New Zealand feels as if it is being pulled apart at the seams. I thought we were egalitarian and unified but some people who feel slightly disenfranchised use that to exacerbate rifts for political reasons.

I suppose it is unreasonable to expect a larrikin to tough it out and try and make things better. He did not offer any solutions and I wonder if there are any? Just a cycle we have to go through? Not sure if he means Maori when talking about people who feel slightly disenfranchised or ACT or Green supporters.

There was also an article about immigration although they did not discuss the age demographic, I will assume it is young people finally getting around to voting and they are voting with their feet.

Not to fear boomers, after shi*ting on the younger generations all your life just because the ungrateful little b*rstards don't want a minimum wage job wiping your old ar*e in a rest home, there is plenty of cheap labour wanting to come to NZ as it is still relatively better than a lot of places around the globe. (Not Italy according to Marc, I hope he doesn't have the gall to support the AllBlacks at the world cup as he is heading to the Azzurri country)

Note to administrator happy to be banned for bad language I think I was happier when I couldn't post.

[Balance]

A capital gains tax is long long overdue in NZ but NOT under a Labour government which only knows how to spend and squander taxpayers' money on wasteful spending.

Bring CGT on ASAP so NZ is in line with the rest of the OECD.

[777]

Tried reading the sports pages to avoid the depression brought on by all the other news but then read that Marc Ellis is looking to leave NZ. I think he has done quite well for himself not sure if you could say "rich". But it is not the unimaginable thought of a capital gains tax driving him from these shores it is

New Zealand feels as if it is being pulled apart at the seams. I thought we were egalitarian and unified but some people who feel slightly disenfranchised use that to exacerbate rifts for political reasons.

I suppose it is unreasonable to expect a larrikin to tough it out and try and make things better. He did not offer any solutions and I wonder if there are any? Just a cycle we have to go through? Not sure if he means Maori when talking about people who feel slightly disenfranchised or ACT or Green supporters.

There was also an article about immigration although they did not discuss the age demographic, I will assume it is young people finally getting around to voting and they are voting with their feet.

Not to fear boomers, after shi*ting on the younger generations all your life just because the ungrateful little b*rstards don't want a minimum wage job wiping your old ar*e in a rest home, there is plenty of cheap labour wanting to come to NZ as it is still relatively better than a lot of places around the globe. (Not Italy according to Marc, I hope he doesn't have the gall to support the AllBlacks at the world cup as he is heading to the Azzurri country)

Note to administrator happy to be banned for bad language I think I was happier when I couldn't post.

You are sick. Get some help.

[Aaron]

You are sick. Get some help.

Many thanks for your concern.

[Aaron]

If true Chippy's plan is to take GST off fresh food. Good to see Chippy is "In It For Us".

He rules out a capital gains tax like the spineless wimp he is proving to be. Then looks to buy votes with an idea even his own advisors think is dumb. I guess Chippy understands that at least some of the voting public is even dumber.

Has Chippy asked all the hard working Kiwis how residential rents being exempt from GST has helped with their budgeting? I guess not.

Our oligopolistic supermarket chains will be the only ones possibly benefiting from GST being taken of fresh food, hopefully the 15% increase in margin offsets all the d*cking around with the GST changes.

Chippy desperately introducing dumb ideas to buy votes from idiots does not sound like he is "in it for us" Chippy is desperate to hang onto power and has just shown he does not give a f*ck for the country as a whole. Actions speak louder than slogans Chippy.

Mind you I do not think he is better or worse than any of the others. They all have to pander to the worst in us to get elected.

[Aaron]

He sounds like the type of guy we need running the country.

https://www.nzherald.co.nz/business/sir-colin-maidens-new-book-is-new-zealand-a-fortunate-country/S2OQI35MXVH7HA7FSN3O4UFBQE/

Colin Maiden knows how to introduce a capital gains tax.

he supports a moderate capital gains tax – “maybe about half the normal tax rate”; probably a few other implementation issues to be addressed.

I can hear all the dummy lefties now saying the wealthy (captial) should not be paying tax at half of what poor people (labour) are paying.

Half is better than the current "nothing".

[SBQ]

He sounds like the type of guy we need running the country.

https://www.nzherald.co.nz/business/sir-colin-maidens-new-book-is-new-zealand-a-fortunate-country/S2OQI35MXVH7HA7FSN3O4UFBQE/

Colin Maiden knows how to introduce a capital gains tax.

he supports a moderate capital gains tax – “maybe about half the normal tax rate”; probably a few other implementation issues to be addressed.

I can hear all the dummy lefties now saying the wealthy (captial) should not be paying tax at half of what poor people (labour) are paying.

Half is better than the current "nothing".

I agree, after all places like Australia and Canada have CGT for donkey years. When I left Canada pre-2000, the CGT was 75% of the gain is taxable income (currently, 50% or half is taxable income, same in Australia).

I think there's an unspoken problem why CGT has become so difficult to implement in NZ. That's is due to that around the area of share investments, we already have taxation on it. If your Kiwi Saver invests in overseas shares in America, it will have FIF which is worse than a CGT, but rather a tax on paper gains (and on years like last year where the market went -20%, well it gets to do another 2nd round of taxing for 2023 when the market goes positive). You could be paying FIF on say +10% return in 2023 yet your portfolio would not have reached the end year 2021 high, which essentially robs the potential compound interest. I would put my $ on that the current regime gives IRD more tax take than putting in CGT despite they would get the tax from all those houses in NZ.

[GTM 3442]

Why would any political party bother with a CGT on property? It's a kiss of death from the albatross round their necks.

My pick is that a National government, in it's second term, will introduce a low-rate CGT on easily-valued financial instruments traded through regulated exchanges, and that this will be promoted politically as some variation on "taxing the rich pr*cks" to pay for infrastructure and maintenance

As an aside, I see that over the past few years, the vocal opposition to a CGT has brought the idea of a Wealth Tax into the political sunshine. Whoops!

[SBQ]

Why would any political party bother with a CGT on property? It's a kiss of death from the albatross round their necks.

My pick is that a National government, in it's second term, will introduce a low-rate CGT on easily-valued financial instruments traded through regulated exchanges, and that this will be promoted politically as some variation on "taxing the rich pr*cks" to pay for infrastructure and maintenance

As an aside, I see that over the past few years, the vocal opposition to a CGT has brought the idea of a Wealth Tax into the political sunshine. Whoops!

Maybe post above your post didn't ring any bells. How exactly will a CGT be implemented when investment such as Kiwi Saver, buying & selling shares in say Amazon or NVDIA, are already taxed under FIF? Are you claiming double taxation is perfectly acceptable ?

[Balance]

Maybe post above your post didn't ring any bells. How exactly will a CGT be implemented when investment such as Kiwi Saver, buying & selling shares in say Amazon or NVDIA, are already taxed under FIF? Are you claiming double taxation is perfectly acceptable ?

Scrap FIF in favour of CGT.

FIF with its deemed dividend is inherently unfair, with an underlying assumption that shares only ever go up in value.

[dobby41]

Why would any political party bother with a CGT on property? It's a kiss of death from the albatross round their necks.

My pick is that a National government, in it's second term, will introduce a low-rate CGT on easily-valued financial instruments traded through regulated exchanges, and that this will be promoted politically as some variation on "taxing the rich pr*cks" to pay for infrastructure and maintenance

As an aside, I see that over the past few years, the vocal opposition to a CGT has brought the idea of a Wealth Tax into the political sunshine. Whoops!

Well that would give property another boost!

[nztx]

Well that would give property another boost!


it's never bothered Labour before much .. until during the most recent 5.5 years :)

Even the Late Comrade Cullen must be looking down thinking current mob fairly dumb ..

Have the recent batch of Comrades suddenly fallen on their heads and brained themselves ?
or is severely handicapped and clues deficient the new 2020's Labour look ? ;)

When will Labour announce their new policy that they will be compensating all they enticed into
Property on low interest rates for losses they sustained in the glowing property ownership adventure
that turned out as sour and rancid as a plate of stale old burnt sausage rolls ? ;)

[Balance]

it's never bothered Labour before much .. until during the most recent 5.5 years :)

Even the Late Comrade Cullen must be looking down thinking current mob fairly dumb ..

Have the recent batch of Comrades suddenly fallen on their heads and brained themselves ?
or is severely handicapped and clues deficient the new 2020's Labour look ? ;)

When will Labour announce their new policy that they will be compensating all they enticed into
Property on low interest rates for losses they sustained in the glowing property ownership adventure
that turned out as sour and rancid as a plate of stale old burnt sausage rolls ? ;)

Dumb is bad enough but this clueless mob is arrogant while stupid.

Why Aotearoa is in the mess it is in.

[GTM 3442]

Maybe post above your post didn't ring any bells. How exactly will a CGT be implemented when investment such as Kiwi Saver, buying & selling shares in say Amazon or NVDIA, are already taxed under FIF? Are you claiming double taxation is perfectly acceptable ?


FIF arose from the lack of information available about individual’s investments in other jurisdictions.

It’s no longer needed, it’s inefficient, costs a fortune in both administration and compliance. Officially mandated EoI makes it redundant, and so a CGT as above rides in straight over the top.

[SBQ]

FIF arose from the lack of information available about individual’s investments in other jurisdictions.

It’s no longer needed, it’s inefficient, costs a fortune in both administration and compliance. Officially mandated EoI makes it redundant, and so a CGT as above rides in straight over the top.

I highly doubt it's a lack of information. The key reason being, (from what a Parliamentary spokesperson explained to me at the time of FIFs introduction), was entirely around the difference in taxation. Most companies on the NZX you have an expectation that dividends should be paid, whereas most companies listed on the Nasdaq, focus less on dividends and instead, higher appreciation of the share price. Because NZ doesn't have a formal CGT, the NZ investor would achieved untaxed returns on such investments.

Why has the media not picked up on this issue that if CGT were to be introduced in NZ, the issue of FIF needs to be removed ; and why no politicians has mentioned this before? Maybe because IRD is already getting more tax take under the current regime than if under a CGT model.

[Aaron]

I highly doubt it's a lack of information. The key reason being, (from what a Parliamentary spokesperson explained to me at the time of FIFs introduction), was entirely around the difference in taxation. Most companies on the NZX you have an expectation that dividends should be paid, whereas most companies listed on the Nasdaq, focus less on dividends and instead, higher appreciation of the share price. Because NZ doesn't have a formal CGT, the NZ investor would achieved untaxed returns on such investments.

Why has the media not picked up on this issue that if CGT were to be introduced in NZ, the issue of FIF needs to be removed ; and why no politicians has mentioned this before? Maybe because IRD is already getting more tax take under the current regime than if under a CGT model.

Agreed my understanding for the FIF regime is that overseas companies tend to reinvest earnings into growth (esp. USA) and NZ investors could invest in US shares basically tax free (unless they were traders of course). We also have imputation credits which stops the double taxation when a company pays a dividend from tax paid earnings.

Why would the media worry about the scrapping of the FIF regime and the bright line test etc. when a comprehensive capital gains tax has no chance of being implemented. Last three prime ministers have had to explicitly rule out its implementation and ones previous to that did not have to as you would get your head bitten of for even discussing such a thing.

[Aaron]

Rob Campbell has a view as do we all.

https://www.newsroom.co.nz/how-to-stop-making-arithmetic-of-an-unequal-society-add-up

I'll pick the bits I like.

Major party discussion on this has become bizarrely focused on who will reduce which tax. This at a time when there is widespread acceptance that we face huge infrastructure deficits in everything from housing to hospitals, transport to training, flood protection to food security. When the big problem is how can we afford to face these deficits, we talk about how we can escape paying.

30 years of avoidance has been successful so far, kick the can down the road, use debt and print money?? People don't notice an inflation tax so much, not asset owners anyway.

Taxes on wealth in various forms are declared off limits by several political parties. There are different versions of these – land, capital gains, asset, inheritance. We are an outlier tax haven on all these matters.

Any party not facing the facts of social and infrastructure deficits, the urgent need to address them, and getting the money to do that, does not deserve your time or your vote.

If we exclude ACT, National and Labour as Rob suggests the choices are getting limited.

[Aaron]

Interesting view on capital gains tax from treasury.

https://www.stuff.co.nz/business/350167952/capital-gains-tax-could-help-balance-govt-books-treasury

Current govt not likely to implement one, gutless Hipkins has already exposed himself by pandering to the selfish morons that make up a significant portion of the voting public.

[Balance]

Rob Campbell has a view as do we all.

https://www.newsroom.co.nz/how-to-stop-making-arithmetic-of-an-unequal-society-add-up

I'll pick the bits I like.

Major party discussion on this has become bizarrely focused on who will reduce which tax. This at a time when there is widespread acceptance that we face huge infrastructure deficits in everything from housing to hospitals, transport to training, flood protection to food security. When the big problem is how can we afford to face these deficits, we talk about how we can escape paying.

30 years of avoidance has been successful so far, kick the can down the road, use debt and print money?? People don't notice an inflation tax so much, not asset owners anyway.

Taxes on wealth in various forms are declared off limits by several political parties. There are different versions of these – land, capital gains, asset, inheritance. We are an outlier tax haven on all these matters.

Any party not facing the facts of social and infrastructure deficits, the urgent need to address them, and getting the money to do that, does not deserve your time or your vote.

If we exclude ACT, National and Labour as Rob suggests the choices are getting limited.

Interesting and very telling that Rob Campbell has never ever mentioned wasteful spending and the $90 billion in debt piled up by Ardern, Hipkins and Robertson.

Hence, he has zero credibility imo.

[Bjauck]

Interesting view on capital gains tax from treasury.

https://www.stuff.co.nz/business/350167952/capital-gains-tax-could-help-balance-govt-books-treasury

Current govt not likely to implement one, gutless Hipkins has already exposed himself by pandering to the selfish morons that make up a significant portion of the voting public.

Mind you, if a cgt scheme were introduced, the family home would probably be exempt from both the new CGT and income tax (as currently). This would make home ownership even more appealing for overcapitalising and accumulating wealth. Any government would have to beef up the KiwiSaver with decent tax concessions to offset the increased attraction of further overcapitalising the exempt home. How likely would that be?

[777]

A capital gains tax would not need to be at marginal rates. It could be a set rate. Somewhere between 15c and 25c in the dollar.

[blackcap]

We don't need a capital gains tax. The government needs to spend less or spend more efficiently.

If there was to be a capital gains tax, (I would like to see a reduction in income tax or a reduction in GST). In addition you will need to have an inflation adjuster to account for artificial price increases.

[Daytr]

Mind you, if a cgt scheme were introduced, the family home would probably be exempt from both the new CGT and income tax (as currently). This would make home ownership even more appealing for overcapitalising and accumulating wealth. Any government would have to beef up the KiwiSaver with decent tax concessions to offset the increased attraction of further overcapitalising the exempt home. How likely would that be?

We already tend to over capitalise our homes now, new kitchen every 10 years, I know people that have put in $100K & $200K kitchens.
Everyone has butler's pantries, walk wardrobes, mud rooms etc you name it.

Although I think a CGT is an essential tax tool, it won't be enough to fund the massive infrastructure deficit.

Where NZ goes wrong is we leave land development in the hands of developers. In the past the Government used to develop subdivisions or entire towns.

The Government should buy land for redevelopment, rezone it for development & then either sell it to a developer and take the huge increase in value, or even complete the development & sell it on to residential buyers.

At the moment landbankers, farmers & developers get a huge windfall when land is rezoned. It's money for nothing that the Government or Local Council could be benefitting from to fund infrastructure.