Labour's capital gains tax figures don't add up, says Key

John Key

Prime Minister John Key is already peppering Labour’s capital gains tax proposals with political buckshot, even though Labour is yet to formally announce the policy.

The policy though was informally announced on television last night, and all reports say much the same thing: a 15% capital gains tax, with the family home exempt, with the promise this will reap $4.5 billion a year for the government.

Prime Minister John Key told a Wellington business breakfast this morning Labour’s numbers do not add up.

A capital gains tax would need to be levied at 30% to raise the revenue Labour is talking about, he said, and it would also have to be cast much wider than investment properties.

“You could only raise anything like $4.5 billion if you have a 30-% capital gains tax on all farms, on all shares, family baches, and all investment properties.”

Because the tax is typically only levied when the asset is sold, it would take a long time before the government collected much extra revenue.

At 15%, it would be 15 years before the government collected $500 million a year, he said.

“So they’re going to have a $12 billion hold in their first three years [if Labour were elected]” he said.

“We have had two tax reviews in the last decade - the Mcleod Review in 2001 [under the last Labour government] and the Tax Working Group last year, and both of them rejected a capital gains tax for New Zealand,” he said.
 

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LOLbour

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While it may suit Labour's front bench to watch Goof fumble his way thru the election and get the boot afterwards... I would be decidedly nervous if I was sitting anything lower than about No.15 on the Labour party list.

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Goff's a goof if he thinks this will run. Wonder if he has the gonads to fall on his sword pronto pre election if the polls go against him and this silly idea.
Shonkey must be dancing with delight.

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Overseas-funded bank mortgages on rental properties and a landlord-friendly tax regime have together severely damaged this economy. The disincentive for this type of unproductive investment is 30 years overdue. And John Key just wants to have a fire sale of key assets to fund his excessive borrowing!

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I'm not even going to start on telling you how weak your argument is, when most of the policies and outcomes you are talking about are due to the Labour government

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you have a point but.....
people who invested in finance companies lost all their money.

the Share market in NZ is not a real strong base to invest in which means you need to invest offshore.

People who invested in property did so because it was deemed safe and they understood it.

So its all very well to criticise but at least offer a logical alternative. Problems are easy to jot down, what about solutions?

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Excellent point!

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My bet is that you don't have a rental property!

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My bet is that you don't have a rental property!

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Phil - when would the base line be drawn? Would it be from a valuation when the CGT is brough in or would it go back to 15 years ago when I bought the property? What expenses could be claimed if the property has not been rented? Need answers now!

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Capital Gains Tax has to come: all concerned and informed commentators back it.
Key should have had the balls to back the Tax Advisory Groups recommendation.

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rubbish..typical left wing comment, as usual no idea as to the facts

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Wonder who decided that with Liebour dead in the water ,they are trying to be born again and reinvent themselves .First stop land tax affecting retirees or other people suffering from the do nothing

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iF CAPITAL TAX COMES IN THEN I WILL UP THE RENT ON THE RENTAL I OWN

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Indeed.
Those running a bona fide property investment business wil simply adjust their managemnt to take into account any up- coming taxation. After all in most cases they will only sell if it is good for thier business strategy and they cover their costs.

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iF CAPITAL TAX COMES IN THEN I WILL UP THE RENT ON THE RENTAL I OWN

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I totally agree with you and will be doing the same on my renters.
Curious though how seeing as NBR slapped an earlier post I made on this topic with 'delayed for moderation' and it has never appeared....how you got 2x posts allowed <g> by the way your caps lock is stuck. Seems NBR has trouble with these blogs, they cant stop ads for rolex , perfume and Penny Bright, but dump others at random.

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Comments are not queued before appearing. I will check and see what the issue was with your comment.
Thanks

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Chris Kealls very interesting NBR - Blog NBR publisher to NetHui: comments will stay anonymous - has jammed for moderation at 9:40 AM
Something amiss pleased to see rather than censorship.

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We heard you the first time. Please stop yelling.

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Pt2 continued. Leibour Govt who allowed thousands of investors to be robbed by finance companies.Wonder why the defacto leader Helen Clark running the Liebour Party from New York has had a change of heart on CGT.After all she has or had quite a few investment properties.

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Hey Phil and LieBore...let me give you a tip on a clue to men's characters: the man who damns money has obtained it dishonorably; the man who respects it has earned it

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When facing an election the party in power hopes for an economy that is purring along AND / OR an opposition that presents a policy that scares the b jez out of the population.

Well done Phil, you just played Russian Roulette with 6 rounds loaded in the magazine. I hear you're going to pull the trigger on the policy soon, don't worry if the first shot doesn't work there will be plenty more opportunities to pull the trigger again before the election.

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Years ago the then government introduced a speculator tax that lasted one year. My next door neighbour was in that lark and never paid a bean, large gin palace boats were traded for $1 then bought back later the same day to avoid the tax on property. The only ones caught by this tax were a few very small time traders...which was why it was dropped in a year as unworkable. The rich won't pay this, just ordinary the citizens. Give it up its a bad idea

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Jey Phil...degrees of ability vary, but the basic principle remains the same: the degree of a man's independence, initiative and personal love for his work determines his talent as a worker and his worth as a man. Independence is the only gauge of human virtue and value. What a man is and makes of himself; not what he has or hasn't done for others. There is no substitute for personal dignity. There is no standard of personal dignity except independence

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The freedom of speech of private individuals includes the right to not agree, not to listen, and not to finance one's own antagonists!

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Four main advantages of a capital gains tax on property

1.A tax on profits from capital gains means we can pay down the deficit without having to sell assets like our power companies.

2. The government can use the money it gets from taxing profits on capital gains to reduce tax on income earned other ways.

3. People will begin to change their behaviour in ways we need as an economy. If someone has some extra cash to invest, they will ask themselves - should I buy a second house, or should I invest in a growing, exporting business? We need more investment going into productive business, instead of into housing speculation. Extra investment in business helps the economy to grow.

4. Young families trying to buy their first home won't have to compete in the market against speculators. That makes home ownership more affordable.

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If investing in the business /export sector is such a clever move , how come the Banks will only lend if they have mortgage security over property /land buldings etc ?
Obviously they know where the best security is to be found in all cases,so guess what - the more prudent private investors want to play by the same rules as the fat cats who pull the strings - Phil you are a loser - get used to it !!

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Oh, hello? this tax will take years to return any real money to the govt because it depends on property sales which will slow down and be bound up in red tape and accountants if this tax goes ahead. It will cause rents and house prices to increase as owners try to offset tax losses. This will in turn encourage foreign ownership of investment property and land. And if you really think Labour will lower taxes in other areas (at least ones that make a difference to people who live in reality, not the dole), you are certifiably delusional.

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Oh, hello? this tax will take years to return any real money to the govt because it depends on property sales which will slow down and be bound up in red tape and accountants if this tax goes ahead. It will cause rents and house prices to increase as owners try to offset tax losses. This will in turn encourage foreign ownership of investment property and land. And if you really think Labour will lower taxes in other areas (at least ones that make a difference to people who live in reality, not the dole), you are certifiably delusional.

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Good on ya Phil, a nice easy target so we can spend it on the welfare system. Phil Goff and your cronies - you really do not know your target market do you. Its almost like you really don't want to win the election. Maybe hats the plan after all its much easier being in opposition - you get to criticise everything the government does but dont have to do anything yourself.

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TAX THE RICH. AUSTRALIA WANTS THEM.

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Poluitical suicide. It may affect future investor decisions but it will also reduce effective housing supply as landlords hold leading to the obvious re prices and rents - all at the low end of the market where low-income earners/the youth rent and first home buyers seek a foot in the market.

If nothing else Labours resounding defeat on the back of this and Phil Goff's ineptitude will once again sideline any talk of CGT as a viable option in NZ for another decade or so.

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Phil and Cun*Life need to realise that a“collective” mind does not exist. It is merely the sum of endless numbers of individual minds. If we have an endless number of individual minds who are weak, meek, submissive and impotent – who renounce their creative supremacy for the sake of the “whole” and accept humbly that the “whole’s” verdict – we don’t get a collective super-brain. We get only the weak, meek, submissive and impotent collective mind.

So go and rob someone else.

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Every government interference in the economy consists of giving an unearned benefit, extorted by force, to some men at the expense of others.

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I can't understand why idiots like Goof and others refer to investment in the property market as the "unproductive sector". This has been a populist term originally espoused by disaffected fund managers and sherbrokers, and those that use it generally put their mouths int overdrive and brains into neutral. So I start a factory making kitset sheds. That is the kind of business that is the "productive sector" - employs staff etc. My business grows so much that soon I am making commercial
warehouses and quick-build houses. Practicality dictates that now I have to assemble these away from my factory, and on-site. I am now employing lots of carpenters, plumbers etc. But, according to Goof and many other poor misinformed souls, I am no longer part of the "productive sector" because many of my customers are investors who are buying properties to provide much needed rental housing. After all, the Govt is not in the business any more of providing state owned housing en masse, and they even provide incentives and underwrites to private developers to build low cost housing, which many investors buy. So, the govt hammers my clients with capital gains tax. A big part of my business dries up because investors no longer get the returns they need to make it stack. This execerbates the shortage of houses in some areas, such as Auckland and Christchurch. rents start to rise in those areas 'cos of lack of supply. People start to scream at the govt that they are not doing enough to keep rents down! The govt says it is not a priority nor is it cost-effective in these tough times for them to build more state houses. They provide incentives to developers - maybe something like a LAQC or capital gains tax exemptions. History repeats and all the economists say they saw it coming! Meanwhile, many people are upset at all the money they have lost in the NZ stock market because of poor regulation, lack of transparency and subtle insider trading. After all, the average investor has absolutely no real control over a listed public company, but the majority shareholders and the fat cat directors and senior management are the real winners! People nostalgically think - after filing their worthless share certificates in the bottom drawer - at least I had control over that rental property I had many years ago. Should've hung onto it - my monet would have doubled by now just thru basic inflation. After all, they ain't making any land! Of course property is part of the productive sector! That statement ignores all the people that are employed directly or indirectly in construction apart from the basic social need for an ongoing supply of reasonably priced rental accomodation. I think Goof must have obtained his understanding of economics at the same place as Doctor of Geography Culen!

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I dont work with collectives. I don't consult, i don't co-operate, I don't collaborate.

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Phil you and your party can evade reality, but you cannot evade the consequences of evading reality.

Bring on November.

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Economic power is exercised by means of a positive, by offering men a reward, an incentive, a payment, a value; political power is exercised by means of a negative, by the threat of punishment, injury, imprisonment, destruction. The businessman's tool is values; the Liebore bureaucrat's tool is fear.

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A few thoughts:
capital gain is mostly inflation. If you sell your house or farm to buy another one, why should you be taxed on the inflation, that has happened in the intervening years?
What about the morgagee sales that happened in the last couple of years? Those people had mostly a capital loss. Are they going to get a tax refund?
I think CGT will have its place, but probably when you sell your last house or farm: call it death duties perhaps.

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farmer H - In support of your idea, is there not a precedent with share traders that IRD took interest in and didn't it result in court action such that they could legitimatly claim costs and losses? as you say plenty of capital loss abounds outside Auckland in real estate we only hear of the lucky few.

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Those Labour Party liars, voters and apparatchiks who tell you that man is unable to perceive a reality undistorted by his senses, mean that they are unwilling to perceive a reality undistorted by their feelings. "Things as they are" are things as perceived by your mind; divorce them from reason and they become "things as perceived by your wishes."

Go away Goof.

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When facing society, those most concerned, those selected by effort to do the most and contribute the most, have the least to say. It's taken for granted that they have no voice and their reasons they could offer are rejected in advance as prejudiced--since no speech is ever considered, but only the speaker. It's so much easier to pass judgment on a man than an idea isn't it Goofy?

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Outrageous claims by Liebour regards the collection from CGT. (with the primary residence exempt) If there is to be no retrospection applied, new investment punters will be long term players, ie 10% CGT will eliminate most of the 'flip' sales and produce less than $100m pa, well short of $4billion BS!

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In any compromise between food and poison, it is only death that can win. In any compromise between sanity and socialism, it is only socialism that can profit.

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I do not seek the good of others as a sanction for my right to exist, nor do I recognise the good of others as a justification for their seizure of my property or their destruction of my life.

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The housing price rises occurred under Labour Government; why didn't they introduce the CGT tax idea then? Can't blame Goff for Clark's inaction?

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The age of the skyscraper is gone. This is the age of the housing project. Which is always a prelude to the age of the cave.

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Phill what is the state but a servant and a convenience for a large number of people, just like the electric light and the plumbing system? And wouldn't it be preposterous to claim that men must exist for their plumbing, not the plumbing for the men?

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"Being National-lite was a one-way ticket to defeat."

Yep. Let's hope the people of NZ recognise how important the implementation of this tax is as a first step away from the neo-con economic policies - the ludicrously failed "trickle down" scam - that have driven the country into the ground over the past 30 years.

It's crucial that sensible alternatives to asset sales be presented by labour. This is the first and probably the biggest, a chance for a real strike against the decline of the NZ economy.

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With socialism infiltratiing everything we are fast approaching the stage of ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission.

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Thank god, finally someone has the balls to propose a CGT. It is well overdue and will redirect investment dollars into more productive areas of the economy.

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Leftist actors change, but the course of the tragedy remains the same. A humanitarian who starts with declarations of love for mankind and ends with a sea of blood.

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Phil it's not advisable to venture unsolicited opinions. You should spare yourself the embarrassing discovery of their exact value to your listener.

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Capital Gains Tax 'CGT' is sound concept but only if is against all assets excluding the family home.
It would strengthen the tax base and remove a numbers of present distortions in the investment markets

Sadly Goff & is L team are keen to have a narrowly targetd tax - its a pity.
Didnt they learn anything from Dr Cullen and his use of the tax system for social purposes.

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One of the stated goals of this tax is to lower house prices so more people can get their home.
Seems to be working well in Sydney...

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Being an unpalatable choice the main political parties have put off taking this sensible Taxation measure ad nauseam. The cost versus value of property in NZ has become so out of balance due to speculative housing investment it will take many years, if ever, for realistic house pricing to be reestablished. The sooner this Tax is implemented the sooner investment monies will be channeled into the productive sector with the myriad of community benefits that will follow, as well as a fairer Tax gathering/spread system

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CGT will make little difference to the productive sector investment unless taxes are reduced in that area.
Adding a new tax in a recession is a terrible idea.

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It is high time a CGT was introduced in New Zealand. There is absolutely no reason to distinguish between the fruit and the tree, it is a false dichotomy which only serves as a form of wealthfare. Under all capital gains tax systems the family home is exempt, so only slumlords need fear the taxman when he comes knocking. Finally a tax policy that will benefit the majority of New Zealanders, and not just unscrupulous investors who jack up the price of realty for everyone else.

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The idea that the Tennant will pay defiles economic logic - why not if a shortage of supply put ur rents up now??

the tennant sets the rent by way of market force - try doubling ur rent and c if there are any takers!

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Already done it mate!
Try looking at trademe and check out the asking rents in Takapuna, Parnell & Ponsonby. Downside is ratbag tenants doing runners.

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Houses are well overpriced, and a CGT would slow the speculative investment that has driven prices beyond ordinary NZers reach.

Landlords will be paying less to buy new properties and are less overleveraged; their costs should come down, and rents with them. Investors like those Andrew King represents would still be investing (or saving) and the returns on all those investments will be subject to the same tax regime.

Housing might still be attractive, but it wont be the only thing people seeas worth investing in. Maybe current landlords would invest in an industry that does something useful, creates jobs, increases ordinary NZers assets?

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The question to ask is not how can we raise more taxes.

but we should ask
- Why are we spending so much?
- What are we spending the money on?
- What value do you gain from spending (if any)?
- Will spending such monies reduce or increase future spending?

When these questions are answered, you will find that we don't need to spend so much and taxes should actually be reduced, not new ones dreamt up.

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Ken is right. Labour and socialists only focus on spending other people's money, "creating" jobs for Wellington twitmarshes, who wll vote accordingly.

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Finance policies at election times used to be one big yawn, but now thanks to Labour / Goof and Little - we get to watch Labour shoot itself in the foot, repeatedly, whilst only opening their mouth's to change feet.

Phil Goof is the best walking promotion for National that has ever been!

Bring on the election!

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Whereas CGT may be a long term strategy in the rationalisation of our tax system there are a number of issues - basically cause and effect type scenarios which would mean it would not necessarily be the solution Labour hopes. e.g. as John Key says - people will hold on to properties initially not willing to take the immediate loss. Many people wrongly or not have invested in property as a form of super for later years - many being baby boomers set to retire soon. Introduction of this sort of tax too quickly would drop the house prices (some may say a good thing) but would remove some of the capital that is going to be released into the economy anyway as the boomers trade down and so there will be a consequential drop in taxt revenue in other areas, plus people already stung by loosing on the financial investments will loose again meaning we ill also have to provide more support anyway. I see no problem in the long term but it will not represent necessarily an increase in tax revenue - perhaps a change in tax approach but it would need to be signalled and now is not the time to mess around with these things. It should be brought in during good times if it is warranted.

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If Key wasnt borrowing to spent so much, Labour wouldnt have to explore capital gains tax.

Lets get real here, this country has been screwed over by prostituted politicians for decades, and the present lot are trying to paint a grossly picture to get re-elected. All they are setting us up for is the fire sale of State Assets; another Greece.

What household borrows for essentials & doesnt go bust in the long run. There are a two ways out of this, including increasing your income or reducing your expenditure; which successive governements dont seem to get their head around. I believe its choosing not too.

A capital gains tax will take away the distortions to the present tax system. There is no valid reason why one shouldnt pay tax on increased prices; be it equity trades, shares or property investment. This will remove alot of speculation, which is unproductive. Perhaps that is why Key is against this proposal. Didnt he make most of his money through speculation? Adding nothing, just a redistribution of wealth. Just what hes planning for our state assets.

I have more than one property, and I know this will financially impair me. However, I tend to focus on the greater good, and will change my investment strategy if this gets implimented.

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Labour will never get any money from a CGT, the simplest and most effective remedy is "don't sell". The intended consequence of Phils dream solution will be lower turnover in capital assets (the ones that are taxed)

If Govt needs to raise taxes, then they should approach this from the view point that Govt must attract more workers / businesses into the country where they will pay tax. Then make sure that every $1 of tax gathered is used to the maximum benefit, ie get the bureaucrats out of the system.

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boom

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Labour’s capital gains tax proposals are actually the Green Party's few years ago.....Is Labour running out of anymore ideas?

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That's another 200,000 voters gone from Labour's already depleted vote bank :) Good on you Goff to come up with such stupid ideas! When's the next one due?

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At least this looks like being a specific policy announcement. Key and co give wonderful little announcements where he doesn't say anything and we all have to go searching for the detail, by which time they've shot out the back door.

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Anonymous @ 10.01 Is this the Labour Party spin --I see exactly the same in a comment on interest.co.nz.

Introducing a CGT in weak economy is madness. As farmerH has indicated --with the property sector under pressue there are more likely to be capital losses , so it will COST the Govt. of the day.

In fact when you think of it the idea that the Govt. can gain revenue from a CGT is just supporting what they want to stop --over inflation in the property sector. Goff is mad.

Having said ,that I'd support a CGT introduced at the start of an up turn BUT not with the objective of raising revenue -just to try to put a cap on mad over investment.

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CG Tax has always been political suicide - but it has merit. Clark and other Mps never wanted it bc they invested in property and voters would vote them out.

What Goff seems to be missing is that CG Tax needs to be implemented with personal and corporate tax reductions elsewhere.

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Honestly, Goff has a death wish. Key doesn't need to bother campaigning; his biggest asset is Goff.

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As a means of collecting revenue CGT is ham fisted and creates too many distortions. An elegant solution to removing the tax incentive for investing in property is to make interest not deductible for tax and interest income not assessable. This would reward saving, keep interest rates down and treat interest as a higher ranked form of equity which is what it is. It would also put out of business a number tax evasion, sorry avoidance, advisers.

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For those of the sheeple who support a CGT be warned: another new tax that would undoubtedly raise productivity would be a tax on blog commenting and tweeting.

There's no end to the new taxes you can have and the excuses for them: but they all grow the Nanny Police States at the expense of our freedoms, and our privacy from the meddling of busy bodies.

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Here go Labour again with the old 'envy' tax - masquerading this time as CGT.

Same old cockeyed ideology - take from those creating wealth and give it to those on welfare.

Will they never understand wealth redistribution does not work.

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As the artificially inflated costs of a capital gains tax are passed onto prospective house buyers through higher asking prices, and renters through raised rents, houses will become even more unaffordable for everyone (especially the 1st home buyer) and rents will rocket. Increased rental yields will encourage more investment in rental properties (but no selling), driving higher price rises that are tax deductable, and locking renters into a lifetime of renting (aka New York). As renters won't be able to afford to buy a home the incentive to invest in rental properties to cater to their needs increases. Look at the effect the new depreciation laws had on rent prices. Only the government gains from the prospect of a CGT, & if they want people to invest elsewhere they need to provide a good incentive.

What happens to the renter? They leave for Australia. What have they got to lose, it's cheaper.

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Less renters, Less competition and more vacant rental properties. Rents are then reduced. That completes the cycle

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Normally it would complete the cycle, the main difference would be the landlords will be in Australia also, where all the renters went.

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In view of what they hear from the experts, the people cannot be blamed for their ignorance and their helpless confusion. If an average housewife struggles with her incomprehensibly shrinking budget and sees a tycoon in a resplendent limousine, she might well think that just one of his diamond cuff links would solve all her problems. She has no way of knowing that if all the personal luxuries of all the tycoons were expropriated, it would not feed her family—and millions of other, similar families—for one week; and that the entire country would starve on the first morning of the week to follow . . . . How would she know it, if all the voices she hears are telling her that we must soak the rich?

No one tells her that higher taxes imposed on the rich (and the semi-rich) will not come out of their consumption expenditures, but out of their investment capital (i.e., their savings); that such taxes will mean less investment, i.e., less production, fewer jobs, higher prices for scarcer goods; and that by the time the rich have to lower their standard of living, hers will be gone, along with her savings and her husband’s job—and no power in the world (no economic power) will be able to revive the dead industries (there will be no such power left).

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There is no difference between the principles, policies and practical results of socialism - and those of any historical or prehistorical tyranny. Socialism is merely democratic absolute monarchy - that is, a system of absolutism without a fixed head, open to seizure of power by all comers, by any ruthless climber, opportunist, adventurer, demagogue or thug. When you consider socialism, do not fool yourself about its nature. Remember that there is no such dichotomy as 'human rights' versus 'property rights.' No human rights can exist without property rights. Since material goods are produced by the mind and effort of individual men, and are needed to sustain their lives, if the producer does not own the result of his effort, he does not own his life. To deny property rights means to turn men into property owned by the state. Whoever claims the 'right' to 'redistribute' the wealth produced by others is claiming the 'right' to treat human beings as chattel.

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A capital gains tax is well overdue. This should also come in tandem with a wealth tax on those that sit on assets and don't release them for productivity.
The actual process of creating the wealth should be taxed less and certainly the first time a persons income jumps that should not be taxed allowing such things as student loans to be more easily paid off.

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There is no difference between communism and socialism, except in the means of achieving the same ultimate end: communism proposes to enslave men by force, socialism - by vote. It is merely the difference between murder and suicide.

Roll on November. I'm for Key.

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The Labour Party need to beware the law of unintended consequences. CGT is usually not restrospective given the long term nature of investments in capital assets, many acquired to fund retirement. When Australia introduced CGT in the 90's this issue was recognised and the tax applied to assets acquired from the date of the legislation. This meant that pre-legislation assets ("Grandfathered assets") were not caught i.e. there was no CGT on their sale, but if the proceeds from their sale was reinvested, the assets acquired were then subject to CGT if later sold. This lead to grandfathered assets being held off markets and to an almost immediate climb in Australian house prices because the pool of investment properties for sale dried up until the gain in prices offset the CGT. This further put housing out of reach of the Labour Party constituency.

Colleagues working as tax practioners in Australia advised that CGT raised about 5% more in tax while driving their chargeable time up by about 80%. They were obviously happy with the increase in fee income.

In the US, CGT does not apply to the family home provided funds from sale are reinvested in a replacement family home. This has lead to funds being reinvested into family homes more palatial than might otherwise be the desire of the homeowner to retain the 'tax-free' nature of the asset. So funds get tied up in homes and do not get invested in investment properties or shares or businesses.

Maybe I should go back into tax practice as I can see a wonderful time for the tax advisory sector.

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What people do WITH THEIR OWN PROPERTY/ASSETS is not your concern. The right to property is the right of use and disposal. Observe the difference in those two theories: socialism negates private property rights altogether, and advocates the 'vesting of ownership and control' in the community as a whole, i.e., in the state; fascism leaves ownership in the hands of private individuals, but transfers control of the property to the government. Ownership without control is a contradiction in terms: it means 'property,' without the right to use it or to dispose of it. It means that the citizens retain the responsibility of holding property, without any of its advantages, while the government acquires all the advantages without any of the responsibility.

Which one are you?

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The right to life is the source of all rights—and the right to property is their only implementation. Without property rights, no other rights are possible. Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life. The man who produces while others dispose of his product, is a slave.

Bear in mind that the right to property is a right to action, like all the others: it is not the right to an object, but to the action and the consequences of producing or earning that object. It is not a guarantee that a man will earn any property, but only a guarantee that he will own it if he earns it. It is the right to gain, to keep, to use and to dispose of material values.

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Listen to all you twits. You whinge about people fleeing to austrlia because things are so much better over there, well guess what twits, they have a CGT to, so you will not escape it either way. A CGT is wayyyyy!! overdue, I am sick to death of pricks saying we want income tax cuts, well guess what twits, where do you think the money for those cuts to income taxes comes from? Not from the unproductive property sector. You pay NOTHING!! on that property when you sell it at the moment, how FAIR is that? You like to talk about fair, paying your own way and all that, well practice what you preach twits, Suck it up, well overdue, pull your finger out of your as%%s and help the country develop a productive economy, not one mired in property speculation and tax dodging through bleating on about how a CGT is unfair. Pricks! Sink you all in the Mariana's Trench!!

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The right to agree with others is not a problem in any society; it is the right to disagree that is crucial. It is the institution of private property that protects and implements the right to disagree—and thus keeps the road open to man’s most valuable attribute (valuable personally, socially, and objectively): the creative mind.

So don't be a ranting twit...realise where your right to be one comes from.

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Wht a post filled with useless drivel, you get into the trench first clown.

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The first choice—and the only one that matters—is: freedom or dictatorship, capitalism or statism.

That is the choice which today’s political leaders are determined to evade. The “liberals” are trying to put statism over by stealth—statism of a semi-socialist, semi-fascist kind—without letting the country realize what road they are taking to what ultimate goal. And while such a policy is reprehensible, there is something more reprehensible still: the policy of the “conservatives,” who are trying to defend freedom by stealth.

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The statists’ epistemological method consists of endless debates about single, concrete, out-of-context, range-of-the-moment issues, never allowing them to be integrated into a sum, never referring to basic principles or ultimate consequences—and thus inducing a state of intellectual disintegration in their followers. The purpose of that verbal fog is to conceal the evasion of two fundamentals: (a) that production and prosperity are the product of intelligence, and (b) that government power is the power of coercion by physical force.

Once these two facts are acknowledged, the conclusion to be drawn is inevitable: that intelligence does not work under coercion, that man’s mind will not function at the point of a gun.

Vote Liebore vote for Peace. The Peace of the Grave.

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Most landlords like myself are in it for the long term & so CGT won't be an issue. Investors who are into do-ups & on-sell will be more affected as it's a business per se rather than a prioritised income stream. I'm interested to see more of the detail though, esp if family-to-family successions are captured. .

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Will the Real Estate Agent's commission be paid only on the value of the property after CGT has been deducted?

How much of the increase will be allowed to be claimed back if it can be shown that inflation was a contributory factor to the 'capital gain'?

Can I claim the CGT portion as a donation towards the unproductive assets it will be going to support?

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http://blogs.telegraph.co.uk/news/danielhannan/100095451/100095451/

US and UK message that holds true for NZ.

IF WE GIVE PEOPLE A TARGET - THEY'LL HIT IT!

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It's very easy for LieBore to be generous with other people's money.

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For Quentin | Wednesday, July 6, 2011 - 2:34pm
_________

You really are a ghastly, rude, ignorant and insignificant little prole aren't you.

I hear they are hiring for a new 'Sustainable' Development Outreach Coordinator at UNITE...go on quick snap. You might get it.

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So : Labour's solutions involve raising more taxes, and employing more bureaucrats with the extra taxes, so that is a bribe. Of course there are many tax consultants who would secretly love another complicated tax, more fees.
National and ACT : increase the size of the economy, and then there is enough taxation at an even lower tax rate.

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Apparently the current strategy is for them all to head off to NY for a sinecure position at the UN working with Helen to undermine Western civilisation.

It's all over the press and online. Rats fleeing a sinking LieBore NZ ship.

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Liebour is trying to get their dirty little vote catching grab bag filled again.The so called CTG is in fact a Wealth tax in drag.Just look at the supporters, we have the electoral reject Parker and the dumped Helen Clark setting the agenda.Let us not forget the Aussie commie from the watermelon party Rusel with one L aiding and abetting it.Wonder what happened to the secret rental trust they operated,until they were outed.Liebour and the so called "Greens" are cruzifying Australia .What an indictment of power crazy no hopers.

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Well at least they have the courage to have a policy Mr Key.

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Yeah anon. The courage to loot the grafters and redistribute to the shafters.

Socialism truly is a sign of mental illness.

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Hopefully hard working kiwi's who dream of owning homes or a holiday bach will see this for what it is... taxing hard working kiwi's who want a little better for themselves and leave something to their kids so Labour can line the pockets of those self serving unionists, the gaggle of gays and their bludger mates with their hands out & would prefer not to work a honest day

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Never let the truth get in the way of a good story ... many Labour supporters aren't bright enough to figure it out - they still vote for it, - politicians need to be held more accountable and not just every 3 years by way of election!! It's how the real world works after all

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Yes - if AT from the EMA can be held accountable for his comments and actions, so should our politicians and especially Goof and Labour for their policies and the consequences of their policies on the country and her population.

Now let's see some responsible policies - and not election year bribes to the unfortunate who aren't able to think clearly for themselves.

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Have you folk seen this?
________________________________
PRESS RELEASE: SUE HENRY SPOKESPERSON HOUSING LOBBY

“The Housing Lobby supports the Labour Party’s proposed Capital Gains Tax”.

6 July 2011

“ I believe that there is massive public support for Labour’s proposed Capital Gains Tax,” says Sue Henry, Spokesperson for the Housing Lobby.

“The speculative market has falsely over-inflated property values for years shifting out house buyers and pushing up rents.”

“There is no benefit to New Zealand when the taxpayer subsidised capital gain on multiple properties goes off shore, in most cases, with foreign overseas investors.”

“It was disturbing to see advertisements in newspapers from a variety of Asian countries promoting New Zealand as a ‘gold mine’ from which to make a quick, tax-free profit, with NO stamp duty, NO capital gains, and NO limits on foreign property investment.”

“It’s about time the party was over for these greedy property speculators.”

It’s long overdue for the ‘taboo’ to be lifted on this issue.

“The Housing Lobby fully supports the introduction of a capital gains tax with an exemption on the family home,” concluded Ms Henry.

Sue Henry
Spokesperson
Housing Lobby

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In 1973, the newly elected Labour government introduced a CGT for trhe same reasons as now. Just before this I sold my first 3 brm investment house in a county town for a very good price of $12,500. Later that year similar houses in the same street were selling for 3 times this at $36,000!!
The reason? Nobody would sell their house, there were no houses on the market, real estate agents went broke, and there were no houses to buy!! Demand pushed up the price of those remaining to astronomical levels.
As presented this is a negative tax of envy. There has to be another way to shift the investment into productive companies. There has to be a way of making share investment "ordinary" so that ALL of our citizens can consider it their own vehicle, nay duty, for their own advancement and wealth.
Very few storemen & machine operators would consider modest share investment, while our illustrious left-leaning PRESS label such activity a TOXIC environment. Do they not know that their own Unions actively invest their union dues in the wealth creating companies they decry. Via the Union, Super, & Kiwi Saver funds these folk actually own a slice of their employers.
Wake up Kiwi's you are killing your country with your misplaced envy.
Wise up!

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re the Capital Gains tax, tax is theft anyway, it's just theft legalised by the government under threat of punishment. So any new tax can't be supported. Even worse it supports the appaling theory that a progressive tax system is somehow fair and equitable. People with more money already pay more tax in dollar terms.

Besides we already have a capital gains tax in effect. Read the tax act.

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