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View Poll Results: Should there be a Capital Gains Tax on Property

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  • No

    213 100.00%
  • Yes

    74 56.49%
  • Goff is just an idiot

    2,147,483,658 100.00%
  • Epic fail for Labour

    1,935 100.00%
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  1. #81
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    That's right this is a thread about capital gains tax.

    I guess my arguements about GST won't change Minimoke's view, maybe my logic is flawed but it seems to make sense to me and I don't seem to follow his logic pointing out how GST isn't necessarily regressive so I'll have to give it a rest. I agree whether its fair or unfair is a matter of opinion but there is something on that in the Gareth Morgan Article above.

    What is your view on CGT Minimoke? For or Against and why?

  2. #82
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    From the days of Regan and Thatcher followed in NZ by Douglas and Richardson there has been a world wide push to sell Govt. assets and lower taxes. Death duties - gone, Gift duties -gone, marginal tax rates lowered always at lower percentages the lower the income. Definitely a politically driven agenda by the far right.
    He who has the capital makes the gains. It is very simple really.

    Westerly

  3. #83
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    [QUOTE=Aaron;351001][QUOTE=minimoke;350994]
    Quote Originally Posted by Aaron View Post
    We might be at odds here. It places a similar burden on the poor as it does the rich.

    I don't think we are at odds, I just don't think you understand what I am saying. That GST is a regressive tax is a fact not an opinion.
    The less income you earn the more GST you pay as a percentage of your income.
    As far as the basics in life go we could agree that everyone has to eat and drink and wear clothes etc. It doesn't place a similar burden on the rich as it does on the poor. The poor will be spending a greater portion of their income on essentials to survive but the wealthier you are the more discretion you have in regard to your consumption/spending.
    Except... you forget that savings are really just deferred spending... its all going to catch up with the wealthy eventually. Those savings will be spent on consuming goods and services in the future, and the wealthy will be taxed just like the rest of them.

    We don't save money for fun, we save so that we can spend in the future don't we?

    The only real discretion that the rich have is the choice to save or spend their discretionary income. But either way that income will be taxed when it is spent; by themselves or by their kids etc it doesn't really matter, it will still be taxed.

    Probably be need to be a tax on capital leaving the country to make it work though
    Last edited by mr.needs; 12-07-2011 at 08:08 PM.

  4. #84
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    Just another incentive to spend , spend and spend some more as those in charge of the state coffers loot any last penny from those who try to get their head above water. A state dependent nation of debt laden paupers is in Labours best interest.

  5. #85
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    Quote Originally Posted by Aaron View Post
    What is your view on CGT Minimoke? For or Against and why?
    I'm against.
    There is a traditional view that there are four purposes for having taxation. The first is Revenue - a government needs revenue to provide the services which are an outcome of the policy the citizens have voted for. Generally I have no problem with tax as a revenue gatherer. If the citizens are dumb enough to want a Ministry of Womens Affairs (something I think is a total waste of money) I accept this is as an expense that must be paid for and I quietly, but begrudgingly cough up my taxes for this.

    A second concept tied to the first is Representation. We can go back to the boston tea party for the good ole adage "No taxation without representation". This is pretty important because it helps keep government honest with how it spends the revenue. National has shat on this concept in Canterbury by removing our right to elect our representatives to Environment Canterbury yet we still have to pay our taxes. I have a major problem with this - this is something that should be rectified before we introduce another tax.

    The third concept is repricing. This is a mechanism government uses to try to change behaviour. Cigarette tax is an example where smokers are gouged. Worst yet is the Carbon Tax where we are all gouged on the pretence that little ole NZ can stop the planet from self destruction. Bull**** I say.

    The fourth concept is Redistribuiton which is where the government tries to move wealth from the rich to the poor. I have no difficulty with this if the redistribution is to support the needy. I do have a problem with this where the redistribution is to the lazy. Examples of this is payments to benificiaries who have been unemployed for many years during times of low labour supply and with intergenerational state dependency.

    Essentially I am against taxes because the Governement is ****ing with us but its the fourth reason, redistribution which leads me to my primary reason from being against a CGT.

    I'm of the view that those who create an income and take the risks by investing in the capital that a society needs should be rewarded for getting off their bum. They should not be penalised and I see a CGT as a penalty. If we look at property, there is already a mechanism for a governement to gather revenue from rental property owners and thats through the enforcement of policy which already provides for the taxation of revenue - and I can see owners have, in many cases, used the sale of their property at a price higher than they paid for it as a revenue stream.

    If a CGT is to be "fair" it should apply to all gains on capital. That would include any gain I make on the Sharemarket. Now, why would I take a risk by placing my money in a startup company if I don't get a return on the risk I'm taking. If I buy a company and take a low wage so the cash flow is protected in order to grow the business and pay the employees a decent wage why should I then be taxed on the blood and sweat I have put into the business.

    Also to be "fair" if my capital looses value should I not be entitled to a tax rebate?

    Before we look at a CGT the government should get its house in order around the four "R's". If they were to do this we may just find we don't need an extra tax like CGT.

  6. #86
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    [QUOTE=mr.needs;351066][QUOTE=Aaron;351001]
    Quote Originally Posted by minimoke View Post

    We don't save money for fun, we save so that we can spend in the future don't we?
    My idea of abolishing all taxes and implementing a Consumption tax doesn't seem to be gaining any traction - put your post is getting to the point I'm trying to make. A consumption tax gets everyone either now or at some stage. How much fairer can you get than that!

  7. #87
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    Quote Originally Posted by biscuit View Post
    The only CGT close to being "fair" would be a CGT on all assets including the family home etc and realised or not. Anything else is simply an attempt to shift the tax burden even further onto a politically insignificant minority.
    Then why a separate tax? Just treat all gains as income, and eliminate the silly 'intention' test that we have now, and will remain under a separate CGT. But to tax unrealised gains would be a nightmare and quite unworkable, although it would be popular with valuers..

  8. #88
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    Quote Originally Posted by biscuit View Post
    Well I am not in favour of a CGT so it doesn't bother me that it would be unworkable!

    And I'm not too happy about income tax, but to try and decide when capital gain is income - and when it isn't, based on 'intention' is woolly line drawing. Capital gained is always income - like it or not. It is ridiculous to say it is income if earned by a developer, but not income if gained by an investor.

  9. #89
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    Quote Originally Posted by biscuit View Post
    I think that logically you are right. But then, unrealised capital gain in the value of a domestic residence is then also logically "income".
    Is money owing to a business income, or does it only become taxable once received?

  10. #90
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    Quote Originally Posted by biscuit View Post
    I don't understand the relevance of that comment. From my point of view, I have several unmortaged properties paying me income. The Government gets a good slice of that and I think they should be satisfied with what they get! If the properties go up in value, I would be pissed off to have to pay tax on unrealised gain. If they only tax realised gain, that is inherently unfair and it produces a distortion that may influence my investment decisions. We all know that there are distortions in the system, but there are better ways to specifically address those issues.
    I also have unencumbered properties, that's my sole source of income except for a bunch of LPT shares. and pay heaps of tax. I certainly don't want to pay more, but even so I don't see why I shouldn't. It is money earned. There are definitely people, and plenty of them, who play the game solely for capital gain - to date a lot of them have flicked in and out of properties, never made a trading profit, and never paid tax on realising a profit. Good on them - for that is what the rues allow. However the numbers of them doing just that, writing books, running seminars telling others how to do that - it is only a matter of time that this will change. Still, it will be a good few years yet. Goff's mob will never get in so labour will have a new lineup and new policies by the 2014 election. I reckon National will make gains taxable, but it will never be retrospective, so make the most of it over the next 10 or so years.

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