The Green Party in government will end the tax advantages property speculators currently enjoy under National by implementing a comprehensive tax on capital gains, the Green Party said today.
The Green Party is the only political party to have consistently called for a comprehensive capital gains tax (excluding the family home) for more than 15 years. The IMF, OECD, and the Government’s own Savings Working Group have called for a tax on capital gains. National’s 2009 Tax Working Group found that the inconsistent taxation of capital in New Zealand breached all the principles of a good taxation system and significantly distorted investment decision across the entire economy.
“A comprehensive capital gains tax just makes sense and it’s time to just get on with it,” said Green Party Co-leader James Shaw.
“We’re facing a housing and a climate crisis so a capital gains tax and a proper price on carbon are two measures we want to see addressed in a first term of a new government.
“New Zealand is one of the only countries in the developed world to not tax capital gains consistently, which has helped to fuel growing inequality between those who don’t own a home and those who now own ten.
“A capital gains tax will make houses more affordable for young buyers who are currently priced out of the market, while property speculators will lose the current tax advantages of investing in and sitting on property.
“A comprehensive capital gains tax would also benefit the economy by shifting capital out of property speculation and into productive enterprise, creating more jobs and lowering the cost of borrowing for business.
“Exporters would gain from a capital gains tax as it would help take the pressure off our overvalued currency – driven higher from highly leveraged borrowing in the housing market.
“Taxing capital gains more fairly is one of the most economically transformative initiatives we could take, and delivering a fair and workable new capital gains tax will be one of our priorities in government,” said Mr Shaw.
Green Party policy principles for a capital gains tax:
- inflation adjusted
- applies to assets sold in New Zealand
- includes a blanket exemption for the family home
- treats capital gains as income for tax rate purposes