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  1. #101
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    Quote Originally Posted by Lewylewylewy View Post
    ....If you're not convinced, we will just have to agree to disagree. 😀


    It's my opinion that tax is a disincentive policy, and i don't think we need any more disincentives to invest in nz; we want to encourage investing in nz.
    I agree the non-comprehensive CGT proposal would be disincentive to invest in NZ.


    If a cgt is introduced on the famiy home, house prices would drop!


    The same reduced purchasing power could be said of the result of a CGT on shares when the sharemarket in general is rising.


    In most systems overseas I believe there is an exemption of a certain amount of Capital gains in a year.


    However Using the example of a $600k family home being sold at $900k with (say) $100k CGT being payable, most people of working age in our expensive housing market have a mortgage.


    Let's say they are in their late 30's and had a $400K interest only mortgage so their equity was $200k when the house is sold for $900k.


    After deducting the mortgage (900-400=500) their capital gain is $300k on their equity of $200k. So their capital return is 150% even though house prices had gone up by only 50%! If CGT is 33% (which is unlikely as any system would probably have an annual exemption amount and a lower CGT rate) they would be left with 200k capital profit which is still a decent 100% return - still greater than the 50% increase in values. This working couple/family will have double the deposit for their new house in a market that has only increased by 50%.


    It is a political decision to exclude the family home and this would therefore further increase the favourable tax treatment of owner-occupied homes.


    In NZ assuming all other things remaining the same, No CGT would be better than a non-comprehensive CGT system.

    Of course it would be a lot easier if renting was a positive choice in NZ. You could rent in the new town. It would be a more flexible option for those who may need to move around the country.

  2. #102
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    "National MP Judith Collins, a former tax lawyer, told The AM Show any capital gains tax would be removed once National got back into power."

    https://www.newshub.co.nz/home/polit...gains-tax.html

  3. #103
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    Quote Originally Posted by percy View Post
    As you would expect I already have my share portfolio "well positioned" for that CGT implementation day.
    However, buying a modest new over 60s house, to see us over the next 10 years or so, may not have been the best option. Perhaps I should have brought a flash up market town house in Cashmere.
    I think you may have done the right thing as you have released a lot of the tax free capital gains from the last years/decades. It is unlikely that house price growth will be as great in the next decade so you may not miss many tax free gains from exempt owner occupied home ownership. But who knows...

    Yet again it will be the post boomer generations who will miss out...let them eat crushed avocado:0)

  4. #104
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    Hong Kong Government charges point 1 % on share trades. HK $1 in every HK$ 1000 or part thereof..

    Simplicity !!!..

    Can be done with out all of the bureaucracy becoming involved.

  5. #105
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    Quote Originally Posted by janner View Post
    Hong Kong Government charges point 1 % on share trades. HK $1 in every HK$ 1000 or part thereof..

    Simplicity !!!..

    Can be done with out all of the bureaucracy becoming involved.
    And that is the sort "no brainer" Michael Cullen is looking for.

  6. #106
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    Since when ?? He has had his turn..

  7. #107
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    Quote Originally Posted by janner View Post
    Since when ?? He has had his turn..
    Aunty Helen would not let him,but Jacinda may.?

  8. #108
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    Quote Originally Posted by percy View Post
    Aunty Helen would not let him,but Jacinda may.?
    Jacinda who ?

    It would depend upon whether Winston would be agreeable.

    If he can hear above the cacophony coming from the interested parties in the present system.

    " It will not work "..

    Money for jam. Investors win or lose. They reap. No misunderstandings as to whether one is an investor or trader.

  9. #109
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    No chance any party proposing a capital gains tax on one's family home is elected in my opinion.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  10. #110
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    Quote Originally Posted by Bjauck View Post
    With (share and fixed interest) investments many people hold them for the income as well as (with shares) a hedge against inlation. (Just like owner occupied housing with accommodation being the "income" and capital appreciation being the hedge against inflation)
    My primary concern would be that they disregard inflation when taxing capital gains. Without taking inflation into account, the government is not taxing capital gain, they are expropriating capital.

    Quote Originally Posted by Bjauck View Post
    In NZ, many people, who can afford it (including singles and those who need to travel for work,) buy a house because of the current tax adavantages, the ability to leverage capital gains and the fact that NZers historically tend to look down on renting. So many currently do it because it is the most tax efficient investment and not necessarily because they want to be tied to the place where they buy the house.

    Currently with housing many people trade up the property ladder leveraging their capital gains as they go. In retirement they then can trade down accessing their tax free capital as their investment nest egg. I think it should be treated the same way as other investments, which are currently already subjected to income tax.
    A capital gains tax will favour housing over share investments. It is much easier to deal with capital gain of a chunky asset like property. With shares, people buy small parcels at different times, have DRPs, company takeovers, mergers, rights issues. An accountants wet dream.

    If the government is serious about encouraging people to invest in areas outside of housing, it should apply CGT only to property, or leave the tax system alone.

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