Capital Gains Tax

[Bjauck]

I agree that not all asset classes are the same. The fact that it is relatively more secure and easier to raise finance makes home ownership so appealing even for those whose circumstances would otherwise not make home ownership the optimal way of securing accommodation. Exempting it from a CGT would make it even more appealing and reduce the appeal of investment in business and shares.

In NZ Home ownership has often been the default investment or pension scheme. The aim being to leverage capital profit, to trade up so that on retirement there is the ability to trade down to release retirement capital. For most NZ home owner-occupiers capital profit is an important if not the overriding goal of home ownership. It should not be given further preferential tax treatment from other investments unless you want to further encourage people into investing their capital into their housing and away from businesses and financial investments.

As home ownership rates continue to fall, CGT exemption would be a tax break for those on higher incomes and the wealthier - Unlike the example of GST exemption on some foods

[macduffy]

Not particularly. I had some friends visit from Singapore to do a short tour around NZ. they could not believe how expensive things are here and the biggest shocker was paying $10 for a Starbucks coffee

I reckon that anyone buying Starbucks coffee, let alone paying $10 for it, deserves to be fleeced!



(Sorry, nothing to do with the argument for or against a CGT.)

[SBQ]

I reckon that anyone buying Starbucks coffee, let alone paying $10 for it, deserves to be fleeced!




(Sorry, nothing to do with the argument for or against a CGT.)

Haha! well, not if that's the only place for coffee in a, high traffic, tourist riddled place
Let's not forget, minimum wage is on the rise so it won't be long that $10 coffees will be the norm. Plenty of ristos and food eateries closing up in downtown Christchurch because they can't make ends meet (fault of high regulation -> high building costs + higher wages). Bring on the inflation!!

[Bjauck]

Haha! well, not if that's the only place for coffee in a, high traffic, tourist riddled place
Let's not forget, minimum wage is on the rise so it won't be long that $10 coffees will be the norm. Plenty of ristos and food eateries closing up in downtown Christchurch because they can't make ends meet (fault of high regulation -> high building costs + higher wages). Bring on the inflation!!

Yep accommodation costs gobble up so much after tax income.

Minimum wage may be on the rise but accommodation costs have risen so much more quickly owing to the fact that residential building has not kept up with the population increase.

In addition development profits have been made by catering for investors (who seek leveraged capital gains) by building upper quartile big houses on small sections. So the market for accommodation for those who earn minimum or near minimum wage has not been catered for and the low-paid rely on government subsidies. These subsidies (from tax revenues) are not paid for by those property investors whose leveraged returns have been from untaxed capital gains.

[westerly]

Haha! well, not if that's the only place for coffee in a, high traffic, tourist riddled place
Let's not forget, minimum wage is on the rise so it won't be long that $10 coffees will be the norm. Plenty of ristos and food eateries closing up in downtown Christchurch because they can't make ends meet (fault of high regulation -> high building costs + higher wages). Bring on the inflation!!

THey are closing down because of competiion, just too many of them. No other reason

westerly

[SBQ]

THey are closing down because of competiion, just too many of them. No other reason

westerly

There are far fewer eateries and restaurants in downtown Chch today than pre-earthquake era. Far fewer businesses in the downtown core too = less workers = less meal plates and coffees to dish out.

However If you bend over backwards to try to appeal to the globalised rich business people, who are prepared to travel from country to country, you may well end up with a backlash from the general population - and Brexit and Trump situations.

I know this may be a bit off topic but what is exactly the cause of Brexit? From what I recall it's the mass invasion of migrants destabilizing the general population? Perhaps UK wanted to avoid the issues that Greece, Spain, & Italy experienced? In Trump's case, as Munger mentioned you have pro-democrat states in the US that have failed by turning their backs against wealthy businesses that create jobs. I mean you don't need a lot of common sense to see who generates the employment? or perhaps would the economy (and country) be in a more healthy state if the only jobs available was from the gov't?

[Bjauck]

I know this may be a bit off topic but what is exactly the cause of Brexit? From what I recall it's the mass invasion of migrants destabilizing the general population? Perhaps UK wanted to avoid the issues that Greece, Spain, & Italy experienced? In Trump's case, as Munger mentioned you have pro-democrat states in the US that have failed by turning their backs against wealthy businesses that create jobs. I mean you don't need a lot of common sense to see who generates the employment? or perhaps would the economy (and country) be in a more healthy state if the only jobs available was from the gov't?

‘Mass invasion?”....’destabilisation” only if you believe the screaming tabloid headlines. Lots of causes and there are separate threads for those topics. Briefly many of the poorer people and communities who had been promised ‘Trickle down’” benefits from giving tax breaks to the wealthy, were left further behind by government policies. Many consequently were encouraged by populist politicians who urged the disaffected to vote for them with beguiling slogans such as “make America great again” and “bring back control”.

[Bjauck]

First homes in Auckland only for wealthy buyers or from wealthy families who can contribute toward deposits?

Would exempting the family home from a CGT amount to a tax break for the wealthier?

Why not boost income tax thresholds, KiwiSaver tax breaks or introduce a tax break for those who earn up to a certain level of fixed interest?

https://www.nzherald.co.nz/business/...ectid=12205655

[fungus pudding]

First homes in Auckland only for wealthy buyers or from wealthy families who can contribute toward deposits?

Would exempting the family home from a CGT amount to a tax break for the wealthier?

Why not boost income tax thresholds, KiwiSaver tax breaks or introduce a tax break for those who earn up to a certain level of fixed interest?

https://www.nzherald.co.nz/business/...ectid=12205655

Why should interest differ from any other form of income? Surely if interest was not taxed, then dividends and rental income shouldn't be either. (Although I'd be all for it )