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 macduffy
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!!
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Originally Posted by SBQ
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.
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Originally Posted by SBQ
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
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Originally Posted by westerly
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?
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Originally Posted by SBQ
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”.
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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
Last edited by Bjauck; 21-02-2019 at 08:23 AM.
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Originally Posted by 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
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 )
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Originally Posted by fungus pudding
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 )
Fixed interest, as a class of income, does tend to be the investment income that is earned by a broader cross-section of people.
However I do agree with you that all investment income and capital gains should be treated the same. If the family home is exempt from a CGT (and income tax as currently) then why shouldn’t there be tax free thresholds for business and investment income and capital gains - especially for those who do not want to own their own home.
For those who do not own (or cannot own) a family home, then they should have an exemption for their investments (up to a certain threshold?) For those that have a low value family home, then they should be given a CGT and Income tax allowance for other investments. Family home exemption (without a value limit) from a CGT could lead to a mansion effect in NZ.
Perhaps one way to replace the family home exemption from a CGT would be to give all adult taxpayers an annual CGT exemption allowance equivalent to say 5% of the average house price at the start of the year. This could accumulate if unused in a particular year. The exemption could then off-set taxable realised capital gains whether they be from the family home, investment real estate or other investments.
Last edited by Bjauck; 21-02-2019 at 10:15 AM.
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Originally Posted by Bjauck
Fixed interest, as a class of income, does tend to be the investment income that is earned by a broader cross-section of people.
However I do agree with you that all investment income and capital gains should be treated the same.
I did not say capital gains should be treated the same as income. CGT needs to be carefully designed and I eagerly await details of the announcement.
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Originally Posted by Bjauck
Fixed interest, as a class of income, does tend to be the investment income that is earned by a broader cross-section of people.
However I do agree with you that all investment income and capital gains should be treated the same. If the family home is exempt from a CGT (and income tax as currently) then why shouldn’t there be tax free thresholds for business and investment income and capital gains - especially for those who do not want to own their own home.
For those who do not own (or cannot own) a family home, then they should have an exemption for their investments (up to a certain threshold?) For those that have a low value family home, then they should be given a CGT and Income tax allowance for other investments. Family home exemption (without a value limit) from a CGT could lead to a mansion effect in NZ.
Perhaps one way to replace the family home exemption from a CGT would be to give all adult taxpayers an annual CGT exemption allowance equivalent to say 5% of the average house price at the start of the year. This could accumulate if unused in a particular year. The exemption could then off-set taxable realised capital gains whether they be from the family home, investment real estate or other investments.
You're missing the MAJOR distinction between taxing of necessities vs taxing of large size wealth. After all, pretty much EVERY OECD nation treats CGT differently to income tax rates. Why? Show me a country that applies CGT exemption limits each year? How would that be particularly useful to the person that owns no assets? Therefore, I don't see your argument that the principal resident should not be exempt as it would be the single source of asset a person can hold, and more importantly, not having to worry about selling for a capital LOSS (consider those that move from place to place every 5 or 10 years?) and then pay another round of CGT when the market rebounds.
I also do not buy into the argument about those choosing NOT to buy a house and instead, invest their savings elsewhere (ie managed funds). The fact is simple, those that can't afford to buy a house simply do NOT have the $ to save ; what % of those on minimum wage actually contribute to Kiwi Saver? Very few because that 3% they lose off their total annual income would be better spent in putting food on the table. The approach of CGT by other wealthy nations is aimed none other than the wealthy ; the NZ top 5% of the population that has parked their $ in real estate, banking it without having to worry about paying tax on the gain.
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