If National wins ...

[fungus pudding]

It's the last line that really grates. 'Trickle down theory' is alive and well. It never works that way, but they can pretend it does. Those with the capital will make the real money. And as we all know, most of the time, the money is tax free.

Of course money can be used to make more - otherwise there would be no such thing as investment. Your comment that most of the time the money is tax free is simply ignorant.

[elZorro]

Of course money can be used to make more - otherwise there would be no such thing as investment. Your comment that most of the time the money is tax free is simply ignorant.

If I am incorrect, then a simple calculation on the money invested in say, farmland in NZ, versus the tax paid by the owners, would be interesting. Buying farmland is the sort of investment cashed-up businesspeople go to. They don't go there for trading profits, there must be another reason. Commercial buildings are probably similar.

[Vaygor1]

This quote came from someone who commented on a well known blog site and not from any actual blogger. Every comment I have made on ST has been my own so this is a first. It reflects in my view a critical issue the Labour Party needs to solve for its own sake and it is stated so well.

"Just imagine a sports team needs a new captain. They do it democratically, so the sponsors get 20% of the vote, the fans 40% and the team members 40%. The majority of the sponsors and fans like Joe Bloggs, but most of the players hate his guts because he’s a narcissistic back stabbing ratbag. Obviously Mr Bloggs gets the nod, and immediately the captain drops his main contenders, and a couple of the other guys walk away.
How well is this team going to do in the league next year?"

[fungus pudding]

If I am incorrect, then a simple calculation on the money invested in say, farmland in NZ, versus the tax paid by the owners, would be interesting. Buying farmland is the sort of investment cashed-up businesspeople go to. They don't go there for trading profits, there must be another reason. Commercial buildings are probably similar.

Most commercial property owners own one building only which they generally retain for income or retirement income. People who buy farms usually farm them. The idea that people can simply buy properties, be they farms, factories or flats, and simply flog them off tax free is a myth and if you asked around instead of listening to the envy-driven propaganda promoted by the Labour party you would know that.

[craic]

Or better still, read Bill Ralston's page at the back of the Listener for the week 4 - 10 October.

[westerly]

Most commercial property owners own one building only which they generally retain for income or retirement income. People who buy farms usually farm them. The idea that people can simply buy properties, be they farms, factories or flats, and simply flog them off tax free is a myth and if you asked around instead of listening to the envy-driven propaganda promoted by the Labour party you would know that.

The myth is more in the repetion by Fp and others that CGT is bad. The number of vineyards and farms used to writ off income from another profession to lessen tax is
probably not publicly known. Even the family farm allows the write off of many day to day expenses not available to wage earners. Vehicles, telephones, etc. and and therefore reduce tax.

westerly

[Major von Tempsky]

CGT reduces real estate/commercial property turnover, increases prices and never yields more than a fraction of the tax harvest its misty eyed optimistic proponents hope for. If you really have a deficit in your Budget, raising the GST is the second most reliable way of solving it.

The most reliable way is cutting unnecessary government expenditure.

[elZorro]

The myth is more in the repetion by Fp and others that CGT is bad. The number of vineyards and farms used to writ off income from another profession to lessen tax is
probably not publicly known. Even the family farm allows the write off of many day to day expenses not available to wage earners. Vehicles, telephones, etc. and and therefore reduce tax.

westerly

That's quite correct Westerly. If you look at some of the rural supply stores to take a small example, it's interesting to note the range of goods on sale. These all get put onto the one tab. From there, it's a coding issue into the farm accounts.

I'm not saying that this doesn't happen with other business areas, but the scale of some farming operations allows more oportunities. While land-owning farmers may be able to say they are the backbone of the export sector of NZ, they are not fundamentally income tax payers to any degree, nor do their businesses employ a lot of staff outside the family, in general.

[elZorro]

CGT reduces real estate/commercial property turnover, increases prices and never yields more than a fraction of the tax harvest its misty eyed optimistic proponents hope for. If you really have a deficit in your Budget, raising the GST is the second most reliable way of solving it.

The most reliable way is cutting unnecessary government expenditure.

In your opinion, MVT. National has already raised GST to 15%, they've already tried to cut back on public sector staff, and we have had a few disasters. They also have to think about getting new IT systems for IRD, over a billion dollars worth. If they go outside NZ for that, they'll get the results they deserve.

Your first line, the data to back that up (CGT) is where? You haven't replied to my earlier post yet..

[fungus pudding]

The myth is more in the repetion by Fp and others that CGT is bad. The number of vineyards and farms used to writ off income from another profession to lessen tax is
probably not publicly known. Even the family farm allows the write off of many day to day expenses not available to wage earners. Vehicles, telephones, etc. and and therefore reduce tax.

westerly

I have never said CGT is bad. I have said badly designed CGT is bad e.g. Australian system. I have said it will not lower house prices as Parker claimed.
Why would anyone write off something pertaining to another business or profession instead of from where the expense was incurred?
Businesses such as vineyards and farms pay tax on their profits; not their turnover, and expenses do not form part of their profits. Goods taken for personal use must be proportioned out, and don't think for one second the IRD don't keep a strict eye on personal expenses. Go and talk to a few accountants and learn something rather than just parroting the garbage commonly espoused by the hoi-polloi.