Tax panel outcome preordained?

Some things are preordained before the Tax Working Group starts, like no increase in GST or income tax levels, and no CGT on family homes. Other things are subject to what the TWG suggests, and ultimately on what the Government decides.

Dene Mackenzie suggests Cullen appointment means tax panel outcome preordained.

The appointment of former Labour finance minister Sir Michael Cullen as chairman of the Government’s tax working group means a preordained outcome on the introduction of a capital gains tax.

Dr Cullen was Labour’s previous finance minister and one of the key coalition negotiators for Labour after the election.

Cullen resigned from Parliament but was closely involved with Labour in coalition negotiations last month.

Prime Minister Jacinda Ardern ruled out the introduction of a CGT during the election campaign but Labour intended extending the bright-line test from two years to five.

The test makes gains on the sale of residential property sold by non-owner occupier within two years of purchase taxable.

Grant Robertson is being criticised for pushing for a solution to ‘property speculation’ that largely already exists.

Tax experts spoken to by the Otago Daily Times claimed the Government was being disingenuous in its approach to property speculation when it claimed tax was not being paid already on property sales.

Finance Minister Grant Robertson said yesterday the Government wanted to address the issue where property speculators had not paid tax on their income from selling houses at a profit, when salary and wage earners’ incomes were captured.

However, if a person buys a property with the specific aim of selling it for profit, tax will be paid.

If a non-occupier owner buys the house with a long-term period in mind, and they sell within three years, they have to convince Inland Revenue circumstances have genuinely changed.

People buying a house purely to capture gains in a rising market pay tax on the profit.

 

From “Tax and your property transactions” from IRD:

See https://medium.com/@_hehir_/anyone-gonna-call-grant-robertson-out-on-this-c23591f20744

 

 

 

Leave a comment

10 Comments

  1. David

     /  November 24, 2017

    Does my head in, I pay 43% on every dollar of profit from buying and selling a house in GST and company tax. I thought the 2 year bright lines test was a reasonable response as there were a few getting away with it.
    I dont even think Robertson has any idea what he wants, he is a little thick I think.

    Reply
    • Blazer

       /  November 24, 2017

      My heart always bleeds for non productive ..speculators.

      Reply
      • Alan Wilkinson

         /  November 24, 2017

        Not sure you have heart let alone one that bleeds for anyone else, B. But I may have missed something positive you said once about someone.

        Reply
        • Blazer

           /  November 24, 2017

          oh the ..irony..Al…you are one of the most selfish,non compassionate posters I have had the misfortune to..encounter.

          Reply
          • Alan Wilkinson

             /  November 24, 2017

            The sweet sounds of appreciation, B, make life worthwhile. A troll trolled indeed.

            Reply
            • Blazer

               /  November 24, 2017

              well it will probably get worse..if all those bridges are built in…Northland.

  1. Tax panel outcome preordained? — Your NZ – NZ Conservative Coalition

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