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Sweeping the board

Written By: - Date published: 11:38 am, July 10th, 2011 - 56 comments
Categories: capital gains - Tags:

The genius of Labour’s (not yet official) capital gains tax is not just the policy itself but the way it has picked the public mood. Support has been near-universal. The Left loves the fairness aspect – workers won’t be subsidising landlords anymore. The Right loves the implications for capital allocation, interest rates, and the exchange rate. The Nats look isolated and hysterical.

Westpac chief economist Dominick Stephens: “New Zealanders are incentivised to borrow money to buy land rather than invest in productive assets. If we introduced a capital gains tax that incentive would be diminished and there would be a greater incentive for people to save via bank deposits or productive business ownership”

Dominion Editorial: “There is a gaping hole in the tax system. Different sources of income are taxed differently. Earn $50,000 by working 40 hours a week and you will be taxed at the going rate for income. Make a $50,000 profit on the sale of a rental property and you will not be taxed at all”

NBR: “Capital gains and property taxes may be touchstone issues – because of the logic of taxing all income regardless of source”

Paul Little: “A capital gain is no more than unearned income which incurs no tax. The unfairness of this is obvious.”

Mike Hosking: “we’ve for years in this country placed an absurd advantage on owning property. And given it’s free of tax, you wonder why we’ve become so reliant on housing and why the economy has been so tipped towards real estate.”

Gordon Campbell: “Here’s another centre-right maxim that a capital gains tax fits like a glove : the level playing field. There is a fairness issue involved. Why should income earned by the sweat of one’s brow – via wages, and productive labour – be taxed, while income derived from accumulated capital gain (often via financial or property speculation) is exempted?”

Anthony Hubbard: “Capital gains taxes are perfectly ordinary taxes used by most developed countries. They are not recipes for instant economic ruin – otherwise these wealthy countries would be poor. A capital gains tax does not mean everyday Kiwis would be crushed. Capital gains taxes should not lead to panic in an election year: there is nothing in them to panic about.”

Pattrick Smellie: “Finance Minister and Facebook page-owner Bill English didn’t get the presumably intended answer when he asked visitors to the page whether they supported the Labour Party’s proposal for a capital gains tax. When BusinessDesk last looked, at 4.15 p.m., 314 people had voted 88% in favour of a capital gains tax.”

NDU General Secretary Robert Reid: “There is something fundamentally wrong with a housing market that is structured to deliver untaxed capital gains to those who have capital, at the same time as denying the dream of home ownership to the upcoming generation”

Vernon Small: In Labour’s broad camp are some distinctly un- leftwing agencies; the Treasury, the Reserve Bank, the IMF and the OECD; which favour a CGT for reasons ranging from its impact on monetary policy and housing bubbles, to tax fairness, and the promotion of an efficient investment environment.

Corin Dann: “Labour’s decision to include a capital gains tax (excluding the family home) in its election year manifesto is a major shift in the economic debate in this country. For years now economists from Treasury, the OECD, and the IMF have all called on New Zealand to introduce a capital gains tax.”

Andrea Vance: “Labour is taking a bold step and it’s armed with some pretty decent arguments”

Nelson Mail Editorial: “it is hard to deny the theoretical logic that capital gains should be taxed just as all other income is.” [the Nelson Mail also seems to think the pre-launch ‘leak’ was accidental. Bit naive]

John Haretvelt: “Labour, it seems, has wriggled out of the fiscal strait-jacket National forced upon it.”

Waikato Times Editorial: “It is unfair for incomes to be taxed while capital gains are not, of course.”

 Matthew Hooton: “there has always been a huge deficit between Mr Key’s aspirational rhetoric and the boldness of his programme. As discontent grows in elite circles about the point of the Key government, and the public grows weary of promises of an imminent economic boom, there is an outside chance Mr Goff has hit upon a winner with his bold capital gains tax move.”

Council of Trade Unions Secretary Peter Conway: “It is interesting to see the hysterical reaction from the Prime Minister and other Government Ministers. The Government should reflect on the failure of their tax switch. It did not stimulate the economy, is not revenue neutral, and increased the take home pay gap between someone on $30,000 a year and someone on $150,000 a year by a massive $135 per week. What we really need in New Zealand is a set of initiatives to improve productivity and wages, and then a complementary set of initiatives to improve savings, encourage them into productive investment, greater levels of domestic equity in our companies and less reliance on private debt to overseas lenders. A capital gains tax is part of such a policy framework”

Herald Editorial: “Not only would a capital gains tax be hugely beneficial to the economy but the time for its introduction is right. Mr Goff should demonstrate a resolve that recognises as much. A capital gains tax would go a long way towards correcting the crippling imbalance of investment in the economy. Too much of people’s savings is directed towards property, leaving too little available for other, more productive capital investments.”

Matt McCarten: “how can anyone look us in the eye and justify that it is moral for a worker or a small business owner to pay about a third of their income in taxes yet someone who sells a property and makes hundreds of thousands of dollars in profit pays nothing? They can’t.”

Herald on Sunday: “Apart from borrowing money and talking up a questionable programme of asset sales, National is showing no signs of a plan to get us out of the mess we’re in. Labour’s idea, even if it is born of desperation, is a challenge to the Government to prove it deserves re-election.”

AUT Law academics: “From an economic point of view a CGT is absolutely necessary to allow for an efficient allocation of factors of production such as capital. Introducing this policy would force the serious investors to put their money into markets that will stimulate economic growth,”

Micheal Wilson: “Why is it that we say we want to catch up with Australia but keep turning up our noses at the policies they have been using for years? Take capital gains. The suggestion we adopt it has produced much wailing and gnashing of teeth. It’s as if the mere suggestion of such a tax is treacherous, even un-kiwi. In Australia they have had the tax for 26 years and it is a completely apolitical issue. Centre right and centre left governments have supported it for more than two decades. It is common sense to treat capital gains like any other form of income.”

Gisborne Herald: “Taxing investment property gains makes sense for New Zealand”

John Minto: “whenever Labour is thrown [out] it tries to reconnect with workers to give them some reason to support the party again. Hence a capital gains tax. Aside from the predictable squealing from National and Act the move has been supported as commonsense in most quarters. Ardent capitalists can support it because it prevents market distortions whereby people invest in property rather than put their money into more productive wealth-creating enterprises.”

John Roughan: Like most of the people in polls I wasn’t planning to vote Labour this year. Now? It is possible. No single issue has swung my vote before but a capital gains tax could. Tax-free capital gains on property investment is the one crippling flaw remaining in our economy. Economists know it, accountants know it even if they don’t like it. Politicians of every party know it, though none have had the courage to do anything about it. [that’s John fucken Roughan, he used to think that the sun shined out Key’s arse]

Craig Elliffe: “There are excellent logical reasons why it should be part of the total tax position. No one is sensibly keen on the idea of new taxes just for their own sake, but if you put it into a context of a total tax policy, then it makes almost extraordinary sense. To the extent to which you have tax policies that are distortionary on the economic levers and contributors to society, how sensible is it to have property investment four or five times the size or the sharemarket producing no tax revenue.”

Chye-Ching Huang: Prior to 2001, South Africa like New Zealand had considered and rejected CGT over and over again. The same objections to CGT raised in New Zealand have been raised in South Africa: assumed complexity, lack of revenue, and a tendency for CGTs to degenerate over time. In 2001, South Africa’s policymakers got off this hamster wheel by looking carefully at the international evidence, and finding that the common practical objections to CGT were not supported by other countries’ experiences. New Zealand policymakers have yet to look at the international evidence as carefully.

Fran O’Sullian: if a broad-brush capital gains tax is imposed for sensible reasons – not an illusory revenue grab – then it is surely time that New Zealand moved down this track. Labour has to present the introduction of a broad-based capital gains tax as a mechanism to ensure a fairer and stronger tax system. One which will result in more investment shifting to the productive sector and ensuring that the wealthy – who easily avoid the revenue man by rolling up their capital assets – do have to contribute. [Fran tries to a appease her rightwing readers by saying Labour must be on Kronic if it thinks a capital gains tax will raise $4.5b. Umm, Labour never said it would, Fran]

Russel Norman: “This tax loop-hole for those that can afford to own multiple properties needs to be closed. By defending the status quo, John Key is arguing those earning more than $1 million a year shouldn’t have to pay tax on 40 per cent of their income while those on the average wage should pay tax on all their income.”

Duncan Garner: “It is certainly a bold and courageous move to target property speculators who have operated in a tax free haven for decades.”

John Pagani: “from day one, 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. As an extra benefit, this means young families trying to buy their first home won’t have to compete in the market against speculators. That makes home ownership more affordable.”

New Zealand Manufacturers and Exporters Association: “The eradication of the capital gains tax harbour will help to lift productive investment. A more balanced tax system will see investment flow to the most intrinsically profitable areas of the economy, rather than those that are tax advantaged.”

John Armstrong: “That it is an idea whose time is coming can be inferred by the tax no longer being a taboo topic. There is now increasing debate on its merits – the chief one being that its absence distorts investment decisions.”

The Housing Lobby: “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”

Productive Economy Council: “A capital gains tax sends the right signals for investors and means those choosing to take the path of unproductive property investment will have to pay their fair share of tax. While fairness in tax is good, the real long-term benefit is the chance to get more of our limited capital invested in making New Zealand more, not less, competitive.”

The Alliance: “The Alliance Party has congratulated the Labour Party on adopting its capital gains tax policy.”

Stockmarket commentator Arthur Lim: “We need to steer investment into the productive sector and this preoccupation with property is not healthy.”

Liam Dann: “Will Labour be able to successfully work this idea into a policy which is both fiscally responsible and which keeps a credible focus on economic growth? If it can, then it will have something to sell to a voting public which has proved it can handle the complexity of the debate.”

Bernard Hickey: “Labour threw what appeared to be a grenade into the debate around tax this week, but a capital gains tax is not the economic shock or disaster that John Key has portrayed it as. Key is not governing for the nation but in the interests of property owners and the elderly who created our crushing debt load.”

The only opposition I can see is the landlords’ lobby group and the increasingly shrill Nats, and those two groups mihgt be regarded as one in the same considering that every single National MP either owns multiple properties directly or through a trust.

56 comments on “Sweeping the board ”

  1. Wow, some collection Eddie.

    Brand Key is getting a hammering because this has exposed the fact that he does not have an economic strategy and because it raises the question why he with his millions should not pay tax on his capital gains when workers pay tax on the fruits of their labour. 

  2. mikesh 2

    What a bunch of twits.
    CGT is not a tax on income but a (very selective) tax on wealth. But if we are to go down that path it would be more consistent to introduce a comprehensive wealth tax.

    • Lanthanide 2.1

      Can you please clarify how it is “very selective”? And why wealth generated through a salary is taxed under “income tax” but why wealth generated through capital gains is untaxed?

  3. Yes of course the CGT is good for capitalism because it eliminates a feudal landlord hangover which distorts the capital market. But I love this idea of undistorted productive investment as ‘healthy’ capitalism.
    The difference between productive and unproductive investment is that in the former workers produce value in commodities, part of which is the value of the wage, and part of which (the far bigger part) is the surplus value which comprise profits. In the latter, investment buys an existing value (land/house as capitalised rent) for which workers pay the rent out of the existing value of their wage (usually half or more of that value).

    • Zetetic 3.1

      any economic system is about how to allocate limited capital, labour, and energy for ‘best’ outcomes. making sure resources go to areas where it produces most value for least cost (incle environmental cost) would be as much a problem in anarcho-syndicalism or communism as it is in capitalism

  4. Deadly_NZ 4

    Now it makes me wonder if the NACTS are now scrabbling around to bring in their own version of a CGT. We all know that they have NO ideas off their own, and would happily steal anyone elses.

    • Peter 4.1

      Ground breaking ideas are not the strength of the Holyoake wannabes

    • Colonial Viper 4.2

      I reckon the NAT focus groups have been burning the midnight oil this weekend.

    • McFlock 4.3

      Supplementary Monetarisation of Property Revenue, perhaps? A tax on all open windows in a house at the time of sale…

    • Shane Gallagher 4.4

      That’s funny that is – Labour just stole that idea off us Greens, and that is becoming quite a habit of theirs… National are not the only ones out of ideas… 🙂

  5. Lanthanide 5

    Looking at this collection of commentary, one wonders what it would be like if Labour were proposing a land-tax – surely less of a slam-dunk than the CGT has turned out to be, even if ultimately fairer, easier to implement and a bigger revenue generator than CGT.

  6. logie97 6

    Shame CGT is not retrospective in some ways.
    Can think of a Mum and Dad investor (the Aldgate-Whitechapels) who made a pile of money buying and selling dollars on the international market. Bought and sold someone else’s money and made a packet from the commission. Now let’s see, 15 pcnt of 50,000,000 – that’s a cool 7.5 million for starters. Now that would provide a few subsidised internet connections for some superannuatants to participate in the new internet world, wouldn’t it?

  7. MikeG 7

    It would be interesting to see a similar round-up of comments from those opposed to it. Most of the arguments I’ve see/heard are simply “it’s too complicated” (even though most other developed countries have it), or “it’s Labour introducing another tax” (isn’t widening the tax base good?).

    What other countries do NOT have a CGT or equivalent?

    • Lanthanide 7.1

      Don’t forget the cop-out “if it’s such good policy, why didn’t Labour do it during their 9 years in power?”.

      • McFlock 7.1.1

        Well, the answer to that cop out is pretty simple: “The best policies are the result of vigorous debate between a bold government and an opposition that constantly challenges them and keeps them on their toes. For nine years National dropped their part of the deal. Labour’s just showing them how it’s done so that National can perform their opposition duties competently after the election”.
        It’s not a sound bite, but good for public hall debates 🙂

        • chris73

          Kudos to you

          Thats a triumph, blaming Labours inaction on a weak National opposition

          • McFlock

            Hey, I vote Alliance.
            I just reckon that being in government 2 years ago doesn’t preclude the possibility of new policy. Of course, tory disagreement with this idea means that they have the employment and social policies of the late Victorian era.

  8. mikesh 8

    Can you please clarify how it is “very selective”? And why wealth generated through a salary is taxed under “income tax” but why wealth generated through capital gains is untaxed?

    Wealth generated from wages is not actually taxed, though the wages themselves are. The owner of an asset pays tax on that asset’s yield so why should he pay tax on the wealth itself. Such a requirement would only be justifiable if all wealth was being taxed not just the bit represented by “capital gain”. But in that case you might find yourself paying tax on the wealth generated from wages, in addition to the tax paid on the wages themselves.
    I can understand a government wanting to collect tax from persons who make no profit from their asset and rely on a capital gain to justify the investment, but this situation usually comes about because the investment is undercapitalised and the owner is paying out large amounts of interest. However we could rectify this by making interest non deductible. After all, capital gains are not taxed, and capital losses not deductible, so why should the expense involved in obtaining capital (ie interest) be deductible. And why should someone who provides his own capital, pays nothing to the banks, and thereby makes a good profit, on which he pays a normal amount of tax, be hit with a capital gains tax as well.
    Muldoon was thinking along the right lines with his “clawback” idea, but he didn’t go far enough. The clawback emerged only at the point at which the property was sold, and then only if it was sold within ten years of the purchase date. It would have been better for Muldoon to have made made all interest non deductible as I have suggested above.

    • Zaphod Beeblebrox 8.1

      Making interest non-deductible. For certain classes of investment. There’s an interesting idea.

      I know Bill was talking about ring fencing interest losses for residential investment at one stage but chickened out. Obviously did not want to offend the party backers.

  9. Colonial Viper 9

    The genius of Labour’s (not yet official) capital gains tax is not just the policy itself but the way it has picked the public mood

    I’d add another dimension to this: it’s perfectly picked the mood of the business editors, the news journalists and the economics pundits.

    Suggesting a brand new tax in an election year should have been a lethal ‘third rail’ issue, according to conventional wisdom.

    But LAB has somehow not just connected with the mystical ‘middle NZ’, but also with the main stream media.

    I put it down to being gutsy, thorough and having a plan which shows that NZ can look forwards to real leadership after 2 1/2 years of National meandering.

    • chris73 9.1

      But LAB has somehow not just connected with the mystical ‘middle NZ’, but also with the main stream media.
      -Keep dreaming, there’d be quite a few ‘middle NZ’ people with rental properties but I’d say Labour have reconnected with the poor who want to bring @the rich” down to their level

      I put it down to being gutsy, thorough and having a plan which shows that NZ can look forwards to real leadership after 2 1/2 years of National meandering.
      -I might give this statement some credence who Phil Goof wasn’t at the helm

      • Terry 9.1.1

        Chris 73 I invite you to take back and wear your offensive words “Phil Goof”. (Do you have, for starters, an M.A. with 1st class hons?) “Sticks and stones will break my bones, but names will never hurt me” – ever heard this at some stage of your existence? Insults will not help your cause.

        • chris73

          Terry I invite you to take my offensive words, shine them up real nice, turn them side ways, and stick them straight up your candy ass!

          If you smeellllll….what the Rock…Is…COOKING!

          • Lanthanide

            Very convincing comeback you’ve got there.

            • chris73

              Considering how much abuse is thrown about this site I really don’t think that calling Goff “Goof” is that big a deal so I consider my response the only appropriate response to use (and I’m pretty sure hes been called worse in parliament)

              Unless you think that hes our “better” and that mere proles like me should have more respect

              (wait up and I’ll see if I can find my cloth cap, you know so I can doth it next time he passes)

              [lprent: I really don’t care what politicians are called except in one case.

              When I ban or warn someone for behavioral issues, while scanning their comments, I look to see what words they have used repetitively or inappropiately in their comments. If I see words that I have seen before, then I will add them to the auto-moderator. This makes it easier for moderators to identify newbies who are probably going to be problems, and significiantly slows down pack attacks on the site by graffiti artists.

              So if you want to get a word into circulation here, then it pays to ensure that people using it, use it appropriately, and don’t collect bans. This type of self-restraint is usually beyond the comprehension of trolls so it’d pay to use stir phrases that require a modicum of intelligence to understand.. ]

              • jackal

                The question was concerned with the comparative intelligence of you compared with Phil Goff?

                In other words, Terry wanted to know if you had the relevant cognitive ability to determine who is a goof! By judging somebody thus when it’s clear that they’re not a goof, you highlight your own lack of intelligence.

                Whereas we can succinctly say that John Key is a clown by taking the relevant historical information into account, saying Phil Goff is a goof is like saying a low wage economy is good for New Zealand.

                Clearly your answers show that your intelligence is well below that of those you wish to judge. Perhaps idiot or a moron are appropriate words to use as descriptive terminology in your case chris73. I could go further but don’t want to get moderated.

                Attributing yourself to the Rock, who in real life is an intelligent and well spoken man, does not help your argument much. Neither does your use of sarcasm improve our perception of your low IQ level chris73. I surmise that it’s below 70 ie definite feeble-mindedness. You have said nothing to make me think otherwise.

                An M.A. with 1st class hons versus a RWNJ spouting the usual rubbish! Not much competition of intellectual ability going on there if you ask me. The same could be said about the current leadership of National compared to Labour. I don’t believe the polling for a second.

                • Do you think comments and votes should be IQ and qualification weighted?

                • chris73

                  Fair points

                  I judge Goff (’cause you know I’d hate to think I’m importent enough to hurt his feelings) a Goof because:

                  As leader of his party and thus where the buck stops hes responsible for:

                  Continued complaints about breaking electioneering rules (yes yes its always someone elses fault)
                  – yet he hasn’t charged someone to make sure all the rules are followed
                  – and if he has then the person selected isn’t doing their job which leads back to Goffs error

                  Flip-flop comments over Darren Hughes

                  Flip-flop comments over Damien O’Connor

                  Totally mis-handling comments about his Hair (seriously dude just be straight up)

                  Attempting to be like John (after 30 years as a politician doesn’t he know who he is?)

                  I could go on but really its like flogging a dead horse

                  Yes he has a M.A. with 1st class hons and well done to him but that doesn’t make him (or anyone else) immune from bouts of Goofiness (maybe he should have stayed in uni?)

                  Maybe instead of Goof I should have said something like lacking common sense?

                  I’d hate to think that a lack of a first-class degree (which is what is being said here) should preclude anyone from a career in politics (wow that sounds quite elitist eh)

                  How many Prime Ministers of NZ don’t have a tertiary education?

                  • Colonial Viper

                    LOL back to this theme shows how even National’s RWNJs don’t have a plan and are out of ideas

      • Colonial Viper 9.1.2

        -Keep dreaming, there’d be quite a few ‘middle NZ’ people with rental properties

        Median NZ’er living on $29,000 p.a. is not likely to have too many rental properties.

        I’d say Labour have reconnected with the poor who want to bring @the rich” down to their level

        There are very few people who are truly rich in NZ; 95% of people earn less than $90K p.a., and most workers earn less than $40K p.a.

        This is a country with significant issues in wealth distribution and income inequality, and we can do better.

        • chris73

          Median NZ’er living on $29,000 p.a. is not likely to have too many rental properties.

          -Thats not middle NZ, all you’re doing is reconnecting with your voter base (which come to think of it is something Labour hasn’t done in awhile)

          • felix

            Rental property owners are 8% of us, chris.

            It’s you who has a skewed idea of where the middle is.

            • chris73

              Well we’ll see after the next election who get the middle vote

              • felix

                chris is labouring under the delusion (or trying to spread misinformation to the effect) that an ordinary Kiwi is someone who earns $80k +, owns a house, a bach, and a couple of rentals, and travels overseas to sports events.

          • Colonial Viper

            Median income in this country is around $29,000 p.a.

            That means that half of NZ’ers earn more than that and half earn less.

            How much more “middle NZ” do you want to get?

            • chris73

              Too broad a brush stroke for me, trying to pigeon-hole people into little boxes that you can tick off

              Thats one of the (many) reasons Labour will lose the next election

              • felix

                Ok chris, what measure are you using to define “middle NZ”?

                Like in your comment above where you said “Keep dreaming, there’d be quite a few ‘middle NZ’ people with rental properties “

                Is “middle NZ” comprised entirely of the 8% of kiwis who own rental property or not?

                • chris73

                  It doesn’t really matter what I (or in fact most people on here) think, its what happens on election night

                  • felix

                    In the broader sense it doesn’t matter one bit what you think or write here.

                    However in terms of the conversation we’re having, it matters to the extent that you made some statements, had them challenged by facts from CV and myself, and now you’re refusing to own what you said.

                    But as long as we’re clear about it I don’t really care either.

                    • chris73

                      The only way I can prove I’m right is when National win the election

                      If I’m wrong and Labour win then I’ll be the first to admit it

                    • felix

                      Not true chris, it’s perfectly possible to prove you’re right. The way to prove you’re right is to show that this:

                      there’d be quite a few ‘middle NZ’ people with rental properties

                      is accurate. To do this you simply define what you consider “middle nz” to mean (and it’s an ambiguous term so you can pretty much define it any way you like) and then show the evidence that this group you’ve defined does indeed contain quite a few rental property owners.

                      What exactly do you think an election can say about your statement anyway if you don’t define your terms?

            • PG

              Median household income, which is the more relevant statistic, was $64,000 in June 2010.

              • Colonial Viper

                Yes it was. Sucks to be single, solo parent, retired living alone, or of independent circumstance then eh?

                In fact if you look at the stats, married people (or in defacto) accumulate the most income and wealth over time.

  10. Herodotus 10

    Should part of the thinking (selling of this policy) be to switch focus for investment from land to other forms of investment. Then I hope there will be also in conjuction some strengthening of reporting requirements for coys,protection for investors and the bodies that police and monitor + penalties e.g. Fin Coy directors and directors of coys that are operating whilst being insolvent As many NZers have lost faith in these other other forms of investment. Sure investments have varying degrees of risk, hopefully offset by corrosponding potential rewards.
    If it is just to redress the imbalance of the current taxation system & to fund the $5k tax free threashold then sell it as that (Note to Lab make sure that your numbers add up !! 🙂 )
    On an aside, I have not read any comment regarding this. It will temper what happened recently when people were borrowing on the increase of the properties equity to finance new acquisitions. With some of this being taxed it will reduce the amount of new unrealised equity that can be used as security for this new additional debt.

  11. lefty 11

    We shouldn’t get too carried away with the idea the CGT will send investment into more productive areas. After all they had property booms every bit as large in countries that have one.

    It is a good idea to treat all income the same though, and hopefully this tax will not just be about taxing land or wealth but will also include the sale of shares and businesses for a profit.

    The $15 minimum wage is good too.

    We need to know what Labour are going to do about jobs and whether they will lift benefit levels back to pre 1990 levels.

    If Labour were to deal with the benefit and jobs issues then make it next steps a financial transactions tax, a move to eliminate gst, the removal of the Reserve Bank Act, the Fiscal Responsibility Act, the State Services Act, and the other pillars of neoliberalism that prevent governments from governing for the benefit of the people,they would be starting to look vaguely leftish.

    • Lanthanide 11.1

      “It is a good idea to treat all income the same though, and hopefully this tax will not just be about taxing land or wealth but will also include the sale of shares and businesses for a profit.”

      It has already been clarified that it will affect all forms of capital gain, including sales of shares, businesses and collectibles (eg art work and stamps etc).

      Probably it’ll be fairly closely modelled on the Australian one.

  12. DeepRed 12

    At the end of the day, property speculation is basically a glamourised form of hanging out each other’s washing for a living.

  13. Carol 13

    There is a lot of support for a CGT from left & right. But I think it’s a bit of an optimistic gloss to put Duncan Garner in the pro-CGT corner, Eddie. I try to avoid seeing that Nat PR person these days, but did catch him on TV3 morning news in the middle of the last week. He totally talked up how Labour was getting a lot of opposition to the pre-CGT announcement. – nothing about the people that are for it, except by implication – he added in a comment at the end about how people on the right were against it & those on the left for it.

    And the quote you use from Garner above, Eddie, is followed by this in the article linked:

    Putting up taxes is never popular and not easy to sell to voters and Mr Goff should prepare for a backlash.

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