If National wins ...

[Hoop]

Belg ... Maybe we don't mind which two of the major parties get in..eh...both are very good stable political parties with Centre bias

A reference site to look at...Below is an URL to a list of 177 countries ranked from 1 being the worst to 177 the best place in the world using the Failed States index formalae.......I suggest you look at the bottom of the rankings...eh?...hate to see you moving to Somalia (1st) or Chad (2nd)...



Belg since NZ (172) is not good enough..I hope you realise that there isn't many better stable countries in the world to live in....but you are in luck as NZ although close it is not Godzone...Finland (177) has that honour.

So I guess you are moving to one of these better than NZ Countries..eh?..Denmark (173) Switzerland (174) Sweden (175) Norway (176) or Finland (177)...I hope when you move you'll consider flying AirNZ...(Disc: I'm a shareholder)

http://en.wikipedia.org/wiki/List_of...d_States_Index

The post above is the first post of this thread...written just before the 2011 elections..

Nothing much has changed ... the grizzling of how bad our government is running things and if nothing changed we would be much worse off in the next 3 years...

Well...6 years and 2 elections have passed.. In 2011 NZ was the 5th best country in the world and now we are are 8th best out of 178 countries measured..we were about 4th in 2016 but NZ slipped up in that year for some reason..

Click the highligthed thread (still works) above to see the latest 2017 standings

[Bjauck]

I agree that there must be other options - though most of your proposed options appear to make our tax laws just more complicated and less fair..

Your suggestions would be helpful too. Yes the tax system is already complicated. You may have a good point on the gst and rate concession suggestions but I disagree that some stamp duties would add significant extra complexity. The elimination of negative gearing would not increase complexity.

Channelling investment into new building would hopefully relieve inflationary pressure on existing housing and hence eventually increase affordability for first home buyers without needing to adjust LVR or add to NZ's bubble of housing debt.

[Bjauck]

... The shortage is land ready for development....

True...I would add the need to introduce an environment that allows land to be freed up more readily to my list.

[Bjauck]

Interesting Australian item on immigration, negative gearing and housing (with particular reference to Syd and Melb). Could have some relevance to NZ and Auckland.
https://www.macrobusiness.com.au/201...ative-gearing/

[artemis]

Bjauck, when you say eliminate negative gearing are you referring to ringfencing losses (so they cannot be offset against other income)? If so, there are quite a few fish hooks in that.

Or do you mean something else?

[Bjauck]

Bjauck, when you say eliminate negative gearing are you referring to ringfencing losses (so they cannot be offset against other income)? If so, there are quite a few fish hooks in that.

Or do you mean something else?

Suggestion was to eliminate gearing on investment in existing housing (so that losses cannot be offset against income from other sources). Negative gearing for new housing would be a different matter, although all investments should be expected to make a profit within a reaonable timeframe in order to maintain deductibility of expenses.

It is an unrefined suggestion. What do you think the fish hooks would be?

[fungus pudding]

Suggestion was to eliminate gearing on investment in existing housing (so that losses cannot be offset against income from other sources). Negative gearing for new housing would be a different matter, although all investments should be expected to make a profit within a reaonable timeframe in order to maintain deductibility of expenses.

It is an unrefined suggestion. What do you think the fish hooks would be?

Not so many years ago, claiming a loss on property because of interest, always bought forth a letter from IRD enquiring when you thought the property would start returning a profit. Obviously, if they didn't like the answer and it was obviously bought for gain, then IRD had everything they needed to apply income tax to the profit on sale. All they need do, and should do, is reinstate that procedure. It's simple and fair.

[dobby41]

Suggestion was to eliminate gearing on investment in existing housing (so that losses cannot be offset against income from other sources). Negative gearing for new housing would be a different matter, although all investments should be expected to make a profit within a reaonable timeframe in order to maintain deductibility of expenses.

It is an unrefined suggestion. What do you think the fish hooks would be?

Why property?
Seems Xero and Martin Jetpack don't make a profit - or took a long, long time.

[artemis]

Suggestion was to eliminate gearing on investment in existing housing (so that losses cannot be offset against income from other sources). Negative gearing for new housing would be a different matter, although all investments should be expected to make a profit within a reaonable timeframe in order to maintain deductibility of expenses.

It is an unrefined suggestion. What do you think the fish hooks would be?

A few fish hooks off the top of my head.

Tax losses are already carried forward in most ownership structures such as companies and trusts. Those most affected by ringfencing will be the folk with one or two rentals. That is about 80% of owners (not necessarily properties), most of whom will be grumpy if they have not already reached the break even point. Some will sell up.

Where possible, people will arrange their tax affairs to be most advantageous. Like timing of sales so that losses are used up first.

Ringfencing losses means fewer refunds short to medium term but that will change dramatically once break even points are reached and tax losses start to be used up. Ten years of rental ownership will usually be more than enough to break even. After that point no tax could be payable for quite some time.

If owners have to keep topping up from their own pocket they will look to trim expenses and increase income. Maintenance and upgrades may be deferred, upgrades will be to the minimum only, rents will be increased to as much as the market will bear, property managers will have contracts terminated.

[fungus pudding]

Why property?
Seems Xero and Martin Jetpack don't make a profit - or took a long, long time.

A never ending argument. It's easy to show with those companies that their aim was to profit from trading. Set up any enterprise with no chance of ever making a profit, and expenses are not tax deductible. You must intend a profit.
Those who invest in property just for cap. gain will get clobbered by Mr. Taxman.