Ardern on Capital Gains Tax

Jacinda Ardern has just been pushed to clarify Labour’s position on Capital Gains Tax by Guyon Espiner on RNZ.

“The government imposed a capital gains tax, they just haven’t called it that.”

That’s not correct. The current government have imposed a 2 year bright line test, but that has just toughened up the tools to enforce existing tax on capital gains if properties are sold for the purpose of capital gains.

“I’m not going to wait until another election before acting on the findings of the Tax Working Group. I reserve the right to act”

“We do not compare well internationally, we’re one of a handful that do not have taxation in this way.”

“I am happy to rule out CGT on the family home.”

Regardless of what a working group may recommend, but she won’t rule out a CGT.

“This is a matter of principle. We do not have a fair taxation system in this country.”

 

66 Comments

  1. Corky

     /  August 22, 2017

    The begining of the end for Jacinda starts here.

  2. Blazer

     /  August 22, 2017

    Brightline is a Capital Gains Tax however you slice and dice it.

    • High Flying Duck

       /  August 22, 2017

      If you are completely ignorant of tax law, then I guess you could dice it that way.

      • Blazer

         /  August 22, 2017

        may I refer you to this Govts about turn on promoting NZ as a tax haven.Who was so ignorant as to frame legislation like that?Tax law is quite complex at times .You only need to look at case studies…Russell,is a good one,Henderson,the Banks.Form and substance,intent,minimisation….all sorts of variables.Are you an expert?

        • Evasion and dancing around the topic as always Bol….. you should go on Dancing with the Stars. You would make some flat foot stomper look like an expert while you guided them around the floor

          • Blazer

             /  August 22, 2017

            I have 2 left feet…may break every bone in…your toes.Bol.

        • High Flying Duck

           /  August 22, 2017

          Russell was a crook who worked the system for decades. NZ was kind of a haven in some ways, agreed, but not of the sort being promulgated by some. Henderson, the Banks etc are all well and good, but none of this relates to the fact that Brightline is clarity on speculation and property trading and NOT a CGT.

          • Blazer

             /  August 22, 2017

            so the existing law has been abused by cheats for decades…because ‘intent’ could not be identified,is that what you are…saying?

            • High Flying Duck

               /  August 22, 2017

              For one off traders intent is hard to prove – depending on what people told the bank and what documentation they have. Nevertheless IRD were making good progress with compliance, but at some cost.
              The Brightline law clarifies for both buyers / sellers what the tax situation is, so the grey areas are removed. It also removes the compliance cost of IRD enforcement.
              Tax law should be as clear as possible, but there are always areas of ambiguity. This can cause taxpayers to unwittingly offend – and allows some to take advantage. Such is life.

          • Blazer

             /  August 22, 2017

            ‘ the National Government introduced a “bright line” measure. Described by most as a capital gains tax in all but name, ‘Stuff- today.

    • NO it is not. No matter how many times you repeat this Blazer it is not true.

      It was a clarification on the existing law regarding buy and selling residential property on a regular basis…… Buying with intent to sell for a gain has always been taxable with property…

      • Blazer

         /  August 22, 2017

        so you contend the law is/was ambiguous and being abused by the greedy…but a 2 year guideline will stop that activity!’Intent’ what a loaded ..word.

        • Ah so you admit that your initial statement was wrong? Well done Bol – must have hurt to fess up at last….

          As for greedy I have never seen the rapacious so well reward as when Labour are in power. Long standing mercantile houses [Think Fletchers, think Myers, think Todd etc etc] through the last century or so have always done extremely well under Labour – Bob Jones loves Labour governments as it makes his CBD properties very profitable in Wellington as Labour expands the Public “Service” consuming more rental space, for no other reason than it rewards a key constituency…

          • Blazer

             /  August 22, 2017

            I admit nothing and your anecdotes are not persuasive.If you want to see a clusterfuck look at the Natz ‘Super City’…what they said it would achieve and the actual …reality!

            • Bol side steps again, dodges, weaves and runs under his/her/its/blazers own posts for a score against his/her/its/balzers team…..

              Round and round she/he/it/blazer goes – when it/he/she/blazer will make sense I am sure nobody knows…..

  3. “Working Group” means “absolutely and a VERY high tax” in Lingua Jacinda

    • Blazer

       /  August 22, 2017

      on what do you base that conclusion,given Adern has been leader around 3 weeks?

      • High Flying Duck

         /  August 22, 2017

        Look at every announcement made by Labour since she took over – it may give you a clue…

        • Blazer

           /  August 22, 2017

          ‘working group’ is what she is making assumptions about.I realise the wealthy think tax should only be paid by the ‘little people’.Thats the..problem.

          • Again you spread and disseminate a non truth Bol.

            The Super wealthy maybe able to plan their tax exposure – but most of us on higher incomes PAY! and pay rather large chunks of tax on income, tax on investment income, tax on petrol, tax as a sales tax, levies/duties on other things like departure taxes at the airport.

            It suits your political narrative to bang on about this but its not true. A good chunk of Kiwis pay taxes only via petrol and GST – as their income taxes are either deducted from benefits or they receive things like WFF which offset any income tax….

            Plus of course that ever accelerating tax at a local levy called rates

            • Blazer

               /  August 22, 2017

              well ..do you have a trust?And furthermore who uses all these tax havens around the world?Hint it ain’t the…poor.

            • Diversion Bol, as always. Whether I have or use a trust is none of your business.

              Using a trust to protect assets for family is a perfectly valid and legal practice.

              I don’t try and avoid/evade tax Bol. I pay my way plus a damn sight more – hence why I get thoroughly sick of whiners banging on about how the “rich pricks” [tm Labour] are just parasites. Or you shtick of the wealthy don’t pay enough, avoid paying blah blah blah

            • Blazer

               /  August 22, 2017

              no diversion.The key word is always what’s…’legal’.After how many years the law had to be clarified,according to you by introducing another law.Do you know what amendments are?ThaT IS WHY YOUR PREMISE…FAILS.You definitely do try and avoid tax=thats why you have a family trust.Liar.

            • There yet again is a declaration bearing zero relation to truth. end of discussion – you are a bullshitter and a liar of the highest order …..

            • Blazer

               /  August 22, 2017

              @Dave…you don’t try and avoid paying tax..!!Are you human…avoid and evade are different things.Who’s F.O.S and mendacious!

            • The answer to your question is YOU.. impressed you can use big words as well though, indicates you can look things up on Mr Googles website. Maybe you should use said website more before you launch into falsely based tirades….

  4. Patzcuaro

     /  August 22, 2017

    Any introduction of a capital gains tax will not come in isolation and may be accompanied by a reduction in income tax as the tax base is widened.

    • High Flying Duck

       /  August 22, 2017

      Except Labour have already cancelled the planned tax cuts as part of their policy and have not ruled out an increase in the top tax rate,
      Hardly the words of a party looking to lower rates…

      • Blazer

         /  August 22, 2017

        there are a myriad of things…political parties have not…’ruled out’..as you well know.

        • High Flying Duck

           /  August 22, 2017

          But only one party has announced a myriad of new taxes AND said tax rates will not be coming down…

          • Blazer

             /  August 22, 2017

            National like to spring things on people after…the election.Especially 2nd term.Btw only one party wants to reignite the ludicrous property ponzi…and that party…is National.

          • Blazer

             /  August 22, 2017

            ‘National’s 2009 Tax Working Group found that the inconsistent taxation of capital in New Zealand breached principles of a good taxation system’
            ‘ the National Government introduced a “bright line” measure. Described by most as a capital gains tax in all but name, ‘..Stacey Kirk..Stuff.

    • Deadset joke of the day. Apart form Douglas – who of course Labour have thoroughly disowned over the last couple of decades, when did Labour ever cut taxes in any significant way?

      • Blazer

         /  August 22, 2017

        Politicians always take with one hand and give with the other.You should know this by now.Tax cuts are a popular song to sing,and National play it relentlessly….and then increase GST to ..15%.Bol.

        • Oh look a factual statement form Bol – quelle surprise!

          • Blazer

             /  August 22, 2017

            Its always what I base a discussion on…not emotive catchphrases,and myths and misconceptions.

            • Stand up again Bol….. if I didn’t know you were joking and tongue in cheek most of the time I would question whether the world wa off its axis…..

              You use half truths and bold declarations that have no acquaintance to the truth as your stock in trade …. the odd factual statement comes as a complete surprise when you occasionally type it …

            • Kitty Catkin

               /  August 22, 2017

              GST has been 15% for years.

              I would guess that it’s still less than the old sales tax. Does anyone know if it is ?

  5. Brown

     /  August 22, 2017

    ”… a reduction in income tax…”

    Ha, ha ha ha ha ha. This is Labour we are talking about. Their fiscal policy is simply take and waste.

  6. Corky

     /  August 22, 2017

    Oh, dear. Bill has just said Winston will not be allowed near the purse strings should he be in coalition with National.

    Peters may now narrow his choice of coalition partner down and will now find it much easier to work out terms with Labour.

    English has disrespected Winston’s mana in public. There will be utu.

    CGT, here we come.

    • PDB

       /  August 22, 2017

      Winston is poison – the govt after the election will only be in a single term before being booted for at least 2 further terms.

      • Blazer

         /  August 22, 2017

        your psychic abilities develop by the…day.

  7. Talking point one for Bill to the working person – National will ease your tax burden by the simple expedient of moving tax brackets, Labour won’t and they will tax you on anything that moves as well…..

    Jacinda and her strategy team are committing a blue by not ruling CGT out THEN getting a working party in when in power with a view to a 2nd term implementation. Being on the Treasury Benches as incumbent is a powerful position and gaining it by deferring your tax and spend ways is a smarter strategy…

  8. Zedd

     /  August 22, 2017

    seriously; does anyone REALLY want 3 more years of ‘Team Key/english’ who we all know are NOT governing for all kiwis (as they say) BUT only the 50.1% they need to remain in power.. 😦

    CGT is the best option (as in most OECD); why do these tories think its perfectly OK to make profit from buying/selling property without paying tax on it ? OR is their preferred option, on all the money they earn ??

    • alloytoo

       /  August 22, 2017

      It doesn’t matter whether CGT is a “fair” tax, it’s not, no tax is “Fair”, by definition you can only tax those who have money. Usually in far greater proportion to the services they receive from the state.

      It matter’s whether CGT is a “Good” tax, IE a tax that:

      a) Has as broad a base as possible. (no exceptions, consistent application)
      b) Generates a consistent yield
      c) Has little or no administrative burden
      d) Will not lead to undesirable (avoidance) behaviour.

      CGT fails on pretty much all these areas.

      • David

         /  August 22, 2017

        “CGT fails on pretty much all these areas.”

        Correct.

      • Blazer

         /  August 22, 2017

        So which taxes ..succeed on your listed criteria?

        • alloytoo

           /  August 22, 2017

          GST / VAT is a great example of an efficient tax.

          • Blazer

             /  August 22, 2017

            I’ve heard accountants state GST is a neutral…impost.

    • Benefit rises, extension of free health for kids by raising age limit, tax cuts for the working middle class by shifting tax bands [promised]……

      Maintaining benefits and spending when faced by major fiscal events….

      Yip Zedd managing for the 50.1% – if you think about where the tax spend mostly goes its to the bottom 50 plus percent in terms of welfare transfers, medical system costs, education costs……you’re quite correct

      As for buying/selling property as a business or with a view to make a profit IS all ready subject to taxation……

    • Missy

       /  August 22, 2017

      Interesting, in the UK they have both Stamp Duty and CGT on property, and a few weeks ago there was some expert on the radio discussing the housing crisis. The opinion was that the Stamp Duty and CGT was putting older people off selling their property and downsizing, therefore not releasing housing stock for young families and keeping prices high.

      It is a theory and opinion, but shows that it is possible that CGT doesn’t work, people just don’t sell the property, thereby contributing to a housing shortage.

      People buy and sell when the costs of doing so are minimal, the more taxes put on high value goods, housing etc the less anyone will buy and sell, seems simple.

      • Blazer

         /  August 22, 2017

        may seem simple but the reality is you can’t escape tax and a much fairer method of charging it is required.No CGT on your family home,hits your concern out of the …park.

        • alloytoo

           /  August 22, 2017

          Again, no tax is fair and nothing about CGT is efficient, especially once you start throwing in exceptions.

          • Kitty Catkin

             /  August 22, 2017

            Missy, I was surprised by how high stamp duty is when I saw it on Location, Location, Location….one couple had forgotten to allow for this when they bought (or thought that they had bought) a house, and had to cancel the deal when they discovered that the stamp duty would make it unaffordable.

  9. PDB

     /  August 22, 2017

    Labour really hate farmers…………CGT on the family farm not ruled out (so will be brought in), water tax and cutting immigration which will affect farms big time. In the eyes of the left the farmers are the new Jews.

    • Blazer

       /  August 22, 2017

      not too many ‘family farms’ left,one would think.Why is the suicide rate so high,for family farmers?

      • PDB

         /  August 22, 2017

        It’s a tough life Blazer – full of hard work and high financial risk/stress that lead to high rates of depression. Urbanites have no idea – far easier for them to label farmers as ‘rich p***ks’ that only deserve a good financial kicking.

        • Wasting your breath.

        • High Flying Duck

           /  August 22, 2017

          Labour want to put the final nail into the family farming coffin – water tax, carbon tax, CGT, undo the pending tax cuts, cut immigration…hard to see small businesses surviving this onslaught.

          • Blazer

             /  August 22, 2017

            if you think farming is ..small business these days, you are clearly out of touch.

            • High Flying Duck

               /  August 22, 2017

              Many farms still are Blazer. The corporates are taking over, but the takeover is a long way from complete as yet.

            • Kitty Catkin

               /  August 22, 2017

              Duck, you forgot that they also want to bring back the Fart Tax-or that is what it sounded like. What next ? Sunshine tax ? Grass tax ? Breathing tax ?