View Poll Results: Should there be a Capital Gains Tax on Property
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No
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Yes
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Goff is just an idiot
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Epic fail for Labour
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Originally Posted by fungus pudding
And if it fell below inflation - surely we should get a tax refund.
This is what i've questioned all along. During the public inquiry i've submitted where countries that have CGT, they also allow for 'Capital Losses'. So the gains and losses can be applied to future years (just like a business loss can be claimed in IRD to a future year). But the anti-CGT camp says that's too complicated and will just make the accountants rich.
Originally Posted by Bjauck
True, If you were able to borrow to leverage yourself into a million Dollar Auckland home some years ago, then being in the right place at the right time, you would have enjoyed handsome returns on the equity you put in
With the CGT as recommended, it would be even more appealing to leverage yourself into a mansion rather than taking a risk in investing in a income-taxed company or start-up or slogging at building up a business to achieve a similar return on capital - only to have the capital gain then taxed.
Providing if there's a market for big expensive mansions? In Vancouver that market has simply collapsed after the CRA has investigated all of them. You can be sure such mansions are owned by overseas non-residents (something that NZ has banned).
A CGT on the 'book value' of a company is difficult but I would imagine in NZ's case, there will be no CGT if the business itself has been paying taxes (or dividends). Meaning, you don't 'double tax'. You have corporate tax at 28% and when the company issues a dividend, the shareholders get taxed (but the 'dividend credit' is applied to negate any double taxation). I'm pretty certain IRD would not treat CGT on businesses in a double taxed way.
re: minimoke - unfortunately we don't live in a 'fair' world.
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