Capital Gains Tax finally on a major party's agenda

[Hitcher]

Actually we already have a quasi-wealth tax - local body rates. These are calculated on the capital value of your property.

That's because rich people have more than one toilet, and they recycle.

[rainman]

Making a bigger economic cake should directly benefit all members of that economy.

Should's a fine thing. Certainly hasn't been everyone's experience of capitalism (cough, USA, cough), which is what I think the point about the folly of trickle-down was. Distribution is often more important than growth.

Anybody who believes that a tax system that hammers "rich" people and people who own property and other assets that appreciate in value just so that people who contribute nothing can be looked after (in very simplistic terms), are the ones who need a reality check. Or they could consider moving to a country that offers the measures they think will work. Good luck with that.

Or, for as long as we have a democracy, they can vote for who they like, on as sensible, or selfish, or misguided a basis as they wish.

[Hinny]

The very few investors who will be scared off by a CGT are mums and dads who own one rental house.

Anyone who owns two or more houses does so because that is their longterm investment plan. Selling out now makes no sense at all. The serious landlord with half a dozen properties wants those for income - any capital gain is good luck and only arrives in cash after they die.


As for the recession: buy in gloom, prosper in boom. Seen three cycles in my working lifetime..

Not my experience at all.
Property investors I know have houses they don't bother to rent out because it is too much hassle.
Second houses for most are for the income stream.

The rich people I know gain far less wealth per annum from income than from other sources.
CGT's are thus a way of sharing the burden of looking after our society.

As for the boom and bust cycles in NZ fortunes these have coincided with changes in govts.
The country Booms under Labour and Busts under National governments.
Hard pill for the right whingers to swallow.

The Greens condemn both parties for regarding economic growth as a measure of our collective success and therefore an imperative goal.

[BoristheBiter]

As for the boom and bust cycles in NZ fortunes these have coincided with changes in govts.
The country Booms under Labour and Busts under National governments.
Hard pill for the right whingers to swallow.

I think you mean all beneficiaries boom under Labour as its the only way they can get in is by bribing the country.

All i have seen is after three terms what ever party is in gets thrown out as people get bored and forget how bad the last one was.

If Labour was so good why did they go from a 17 billion surplus to a deficit in their last term?

[Ocean1]

Should's a fine thing. Certainly hasn't been everyone's experience of capitalism (cough, USA, cough), which is what I think the point about the folly of trickle-down was. Distribution is often more important than growth.

You miss the point. You contend that a trickle-down effect doesn't work because it fails to completely relieve any responsibility from those who choose not to earn as much as they want.

Consider: Those who do so choose tend to like the idea that there's some reason why they should bother. As H has already said; the only way to get more money out of the "rich" is to tax them less.

Or, for as long as we have a democracy, they can vote for who they like, on as sensible, or selfish, or misguided a basis as they wish.

Yeah. 'Cause they've "earned" that right along with the one that says the world ows them a living.

[240]

The problem with a capital gains tax is that landlords will have to factor in tax payable when the investment is sold.
There are two ways to do this 1:increase the rent return of the property and 2: Increase the sale price on selling.Option 2 may not achieve the result they will need as the market for selling a property a lot more competitive for selling and buying rather than renting.The rental market however is a lot more able to be dictated to by the landlords as demand is strong for rental in most areas as most people start there and have little other options.I believe a CGT will see a huge increase in rent prices across the country.
(any way lets be honest it ain't gonna happen as labor have as much chance of getting in as Ducati have of winning the moto gp )

[Hinny]

as long as we have a democracy, they can vote for who they like, on as sensible, or selfish, or misguided a basis as they wish.

One of the great myths?
The Sheeple are controlled by the media.

Commentary about Rupert Murdoch recently stated that he had made and broken Govts.

John Key certainly has the run of the media.
Given this Govts. performance to date and the stated plan of action if they get re-elected, how is it possible that they enjoy such popularity?
Bill English told Parliament the tax take is up and yet they are borrowing furiously and cutting back expenditure. Borrowing more than they need, buying US treasury bonds, with borrowed money - Where will it end?
The interest on borrowing was recently reported to exceed the expenditure on Health, Education and Welfare. How ridiculous!
Our children are being left an unholy burden. Irreplaceable assets which should be our legacy, their heritage, are destined to be flogged off. Like the failed policy of flogging off the Clyde dam this can only be viewed as short term gain for long term pain.
Security of Energy and security of Food should be paramount concerns of a Govt. intent on protecting the well off-ness of current and future New Zealanders.
National Govts., past and present, have not, it would appear, had this notion as an idealogical priority.

'Only idiots would sell those off' has been a sentiment I have heard expressed a lot recently.
Considering the proposed sale of the best performing State owned enterprises is an alternative to a wider and fairer tax system it is no surprise which party would come up with choosing the dumb option. Not the 'trendy lefty intellectuals', that's for sure!

[Hinny]

YAs H has already said; the only way to get more money out of the "rich" is to tax them less.

FFS
What's that saying about Idiots expecting s different outcome from the same course of action?
It's never happened before so why the hell do you expect it to happen in the future?

[Spearfish]

The problem with a capital gains tax is that landlords will have to factor in tax payable when the investment is sold.
There are two ways to do this 1:increase the rent return of the property and 2: Increase the sale price on selling.Option 2 may not achieve the result they will need as the market for selling a property a lot more competitive for selling and buying rather than renting.The rental market however is a lot more able to be dictated to by the landlords as demand is strong for rental in most areas as most people start there and have little other options.I believe a CGT will see a huge increase in rent prices across the country.
(any way lets be honest it ain't gonna happen as labor have as much chance of getting in as Ducati have of winning the moto gp )

A few property investors bailed when the LAQC and depreciation on the building was killed, all thats happening is a different group with different investment structure are slowly moving in to property investment and in areas where rental numbers are low the rent is climbing.
Real estate is called real estate for a reason and unless lending institutions become happy with lending on other forms of investment then I cant see it changing.
by banks I don't include the (borrow 20 grand to fly the family out from the islands to bury your loved ones at 30%) sharks that target polys"

[240]

A few property investors bailed when the LAQC and depreciation on the building was killed, all thats happening is a different group with different investment structure are slowly moving in to property investment and in areas where rental numbers are low the rent is climbing.
Real estate is called real estate for a reason and unless lending institutions become happy with lending on other forms of investment then I cant see it changing.
by banks I don't include the (borrow 20 grand to fly the family out from the islands to bury your loved ones at 30%) sharks that target polys"

The vast majority of investors are "mum and dad" investors.They work (usually) to a tight financial framework which has little room for change.Based on overseas experiences they are advised to increase rent returns to accommodate sales tax.
Interestingly if someone sells below what they purchased the property for in a negative market they do not receive a tax break only an offset of tax for future use when another property is sold.If you don't buy another you are shit out of luck.The only people who will win from any CGT is accountants.

[The Stranger:Me]

One of the great myths?
The Sheeple are controlled by the media.

Bingo.
Has anyone seen a balanced view of the CGT in the harold yet. I been looking but all I have found so far are exponents of CGT published en masse in the harold.

Is there no one out there who opposes it?

[Hinny]

Bingo.
Has anyone seen a balanced view of the CGT in the harold yet. I been looking but all I have found so far are exponents of CGT published en masse in the harold.

Is there no one out there who opposes it?

They are not out there . . . they are all posting on KB.

Had a laugh on the weekend.
A couple of Right Wing mates and Gareth Morgan were arguing for CGT.
Almost made me reconsider my stance.

[avgas]

I reckon introduce capital gains tax, but make income tax flat.
That way more people can buy the family home, less people will be able to live the "I-have-5-mortgages-but-only-actually-earn-60k p/a" ripoff kiwi dream, but also the people at the top who have investment properties, and can afford to buy them only pay tax on how much they rip people off selling the house, not on how much they earn in a job.
Win-compromise-Win

However convincing the bottom tax payers that is a good idea would be impossible. Even though they would be better off - they can't stand the fact that others will ALSO benefit. Heaven forbid people at the top paying the same % of tax as them.
Surely the reason why people get rich is because they want to pay (proportionally) more tax.

Then again educating low income earners about percentage or fractions sounds like it might be a challenge......

(no I am not on a rich list, I just don't see the point of being being tax proportionally more by trying to achieve more, sounds tall poppy to me).

[Banditbandit]

They are not out there . . . they are all posting on KB.

Had a laugh on the weekend.
A couple of Right Wing mates and Gareth Morgan were arguing for CGT.
Almost made me reconsider my stance.

Hahahaha .. if even the right wing can't agree on it ..

[trustme]

It is easy to mount an argument for CGT. In theory it will discourage people from land banking & investing in a property that gives the individual a capital growth but fails the grow our productive economy. The problem is that Labours policy wont fix some fundamental inequity within the tax system , they will make things worse.The few will pay more, the majority will probably pay less.

Once again they will punish excellence & reward indolence. The tune might be nice ,the orchestra in tone bloody deaf.