The Tax Working Group proposals
This has now been released. Radio New Zealand has this summary:
- “Tax the capital gain on sale of land, shares, business assets, intangible assets such as intellectual property. Tax to be imposed when the asset is sold, and levied at the seller’s marginal tax rate. Assets to be valued from when the tax is imposed.
- The tax would NOT apply to the family home, and personal assets such as cars, paintings, jewellery, and household appliances. However, a holiday home WOULD be taxed on sale.
- The capital gain on shares in companies would be taxed but in some circumstances capital losses would also be able to be offset against other income.
- The capital gain on the sale of a business would be taxed, including the goodwill.
- Exemptions from capital gains to be granted for some “life events” such as relationship breakup, death. A family farm passed on to a family member would be covered by a rollover and there would be no tax on the capital gain. But if the family member then sells to a third party the capital gain would be taxed.
- No changes to income tax rates, but a recommendation to raise the income threshold for low and middle income groups, i.e they would earn more at a low or lower tax rate.
- No change to GST and no exemptions for certain types of products, such as food and drink.
- Environmental taxes: changes to the emissions trading scheme to be more like a carbon tax. Dirty taxes on solid waste to reduce volumes to landfills. Taxes on water pollution and water extraction. Tax deductions to encourage conservation.
- Taxation of fertiliser use. Consider congestion charges to tackle traffic issues.
- No changes to current taxation of Maori assets and incorporations.
- Recommends government take steps to encourage retirement saving for low and middle income groups through possible refunds of employer’s super tax, reduce tax rate on some KiwiSaver investments.
- Review taxation of charities to ensure the income from commercial activities are being used for the charitable causes they are being raised for.
- Give Inland Revenue extra resources for administration and enforcement.”
National has been on the attack for a while. Although they have been pretty sloppy with the detail:
Stand by as the battle of words commences.