whats your thoughts on the CGT

[HEsch]

Saw this as a point of view...


Most mortgages end up costing you double in interest, over the term. Ie, borrow 1 mil, pay back 1 mil principal and 1 (to 2) mil in interest. For simplicity's sake let's say it's the same as the principle (1+1).

Purchase property, 1 mil value. Repay mortgage over many years. Sell property, 2 mil value.
According to the govt, I've made a mil on the property.
Really, I've not made a mil in "profit" because I had to pay interest. I've made $0.
Result: Pay tax on 1 mil. Joy!



(FWIW, I'm not 100% opposed to a CGT, but I don't think the way it is being proposed is going to address the problems we have ie undersupply of overpriced houses).

[merv]

Saw this as a point of view...


Most mortgages end up costing you double in interest, over the term. Ie, borrow 1 mil, pay back 1 mil principal and 1 (to 2) mil in interest. For simplicity's sake let's say it's the same as the principle (1+1).

Purchase property, 1 mil value. Repay mortgage over many years. Sell property, 2 mil value.
According to the govt, I've made a mil on the property.
Really, I've not made a mil in "profit" because I had to pay interest. I've made $0.
Result: Pay tax on 1 mil. Joy!



(FWIW, I'm not 100% opposed to a CGT, but I don't think the way it is being proposed is going to address the problems we have ie undersupply of overpriced houses).

Like I said back here https://www.kiwibiker.co.nz/forums/s...post1131126364 the winners are always the banks.

[sidecar bob]

ok, now we have thrashed out the housing side of this debate & come up with rationale that we all agree on it's time to discuss the pink elephant in the room.
You buy a business that has been failing due to either ineptitude or laziness by the previous owner, or that they have been ripping all the cash out of it in order to run it at a loss, so as to gain tax benefits & ensure that they sell it for less than they paid for it, to avoid paying CGT.
You purchase said business & do everything correctly & honestly. You employ tax paying staff & run it as honestly as is possible & turn it into a very lucrative little earner for the tax man.
After a decade of seven day weeks, 14 hour days, your body & mind can take it no more & you sell it for what it's now worth. The govt pop their hand out & fine you a CGT for being sucessful & honest so they can waste it on on Whanau Ora racist healthcare service that you aren't able to access due to your skin colour.

[Ocean1]

Wait, I thought you were against communism?

If you define communism in terms of state control over production: who gets paid what for it and who benefits from it then yes, I am against communism, it's an inherently unfair system by any definition. So seeing the local marxists using "fair" to describe policy designed to further remove the natural link between production and it's rewards is ridiculous.

I have no problem with the general concept of a collective economy, as long as it's costs and benefits are shared equally. All sorts of reasons it's a good idea, everyone uses some services or infrastructure more or less equally, there's huge economies of scale to be taken advantage of, and there's some costs that are best spread over an individual's lifetime. But when that collective economy becomes larger than the total earnings available to the individuals that generated it you're fucked, it's no longer a viable system.

As I said, a fair system is one where everyone contributes the same and everyone benefits the same. When successive governments have assumed control over the value of both production and the distribution of it's benefits and distorted them to the extent that over half of the population benefits more than they contribute, (at the direct expense of the most productive) then you're well down the same path as every other failed socialist state in history.

[husaberg]

Saw this as a point of view...


Most mortgages end up costing you double in interest, over the term. Ie, borrow 1 mil, pay back 1 mil principal and 1 (to 2) mil in interest. For simplicity's sake let's say it's the same as the principle (1+1).

Purchase property, 1 mil value. Repay mortgage over many years. Sell property, 2 mil value.
According to the govt, I've made a mil on the property.
Really, I've not made a mil in "profit" because I had to pay interest. I've made $0.
Result: Pay tax on 1 mil. Joy!



(FWIW, I'm not 100% opposed to a CGT, but I don't think the way it is being proposed is going to address the problems we have ie undersupply of overpriced houses).

Heres the thing the oceans and the Bobs never mention
Is you can claim the interests paid on the mortgage as a deduction on your taxable income when it run through a business.
No one has said a CGT will apply to a persons Dwelling.
As far as the original intention was it was to stop property speculators and investors getting away with not paying tax on income.
Auckland has an undersupply of houses as the market was distorted by speculators some overseas buying up houses as it was a tax free option.
this created an artificial undersupply of housing to buy which drove up the price further which in returned encouraged more to do the same until housing became unaffordable to the first home buyer.
If you get rid of the tax free incentives at the same time build more houses the price stabilizes, The Auckland houses price increases were unsustainable anyway. The Bubble would has burst eventually.
Remember how National spend years denying there was a Auckland housing crisis.

That's a fucking good one!!!

Really America has a CGT Trumps was trup pledging or mentioned getting rid of it in his campaign?
Seeing as he all about making america Great we can only assume its great with it? Or is he just going to sneak it through, like his alternative tax reform which was aimed at the mega rich avoiding more tax.
Odd we have still never seen his tax returns how many years now still no returns.

Either way, Tuesday’s partial disclosure will further pressure the White House to publish the president’s tax returns in full. As a candidate, Trump broke with a 40-year precedent by refusing to release his tax returns despite repeated calls from his opponents in both parties.

The last major-party nominee to withhold tax records was Gerald Ford, who assumed the presidency after Richard Nixon’s resignation in 1974. Ford released a summary of data from eight years of tax returns but did not disclose the full documents.

i found this from a leaked filing though.
https://www.theguardian.com/us-news/...native-minimum

Hey Jason isnt this the tax Trump reformed?

History AMT
Congress created a simplified version of the Alternative Minimum Tax in 1969. It was originally known as the millionaires' tax. It was designed to make sure the wealthy didn't get away tax free. In 1969, the Internal Revenue Service discovered that 155 millionaires paid no taxes because they used deductions not available to the average worker. Congress applied a higher tax rate on incomes that reached a certain level.

[Ocean1]

Isnt it funny you always go socialist, maxist, Communist.
You go on about this crap when you have MMP and a center left and a center right party its just plain ludicrous.
You are not in the majority last election , likely not the next election either. Get over it.

You can't help yourself, can you? You get all wet at both ends at any perceived slight to your beloved labour party, and spend hours "researching" "facts" to attack the evel Tories in some bizarre attempt to validate your ideologically sensitive feelings. Which is fine. Just don't expect to be taken seriously.

So you again conflate me with the national party, simply because I disapprove of their activities slightly less than the extreme socialist/marxist/communist alternatives. They're still thieving socialist cunts, just marginally less obnoxious thieving socialist cunts, slightly less likely to destroy the country, as socialists everywhere always do.

[HenryDorsetCase]

You can't help yourself, can you? You get all wet at both ends at any perceived slight to your beloved labour party, and spend hours "researching" "facts" to attack the evel Tories in some bizarre attempt to validate your ideologically sensitive feelings. Which is fine. Just don't expect to be taken seriously.

So you again conflate me with the national party, simply because I disapprove of their activities slightly less than the extreme socialist/marxist/communist alternatives. They're still thieving socialist cunts, just marginally less obnoxious thieving socialist cunts, slightly less likely to destroy the country, as socialists everywhere always do.

Look, I think we can all agree that the Tories are cunts.

[Ocean1]

Look, I think we can all agree that the Tories are cunts.

All socialists are cunts. I might have mentioned it.

[husaberg]

You can't help yourself, can you? You get all wet at both ends at any perceived slight to your beloved labour party, and spend hours "researching" "facts" to attack the evel Tories in some bizarre attempt to validate your ideologically sensitive feelings. Which is fine. Just don't expect to be taken seriously.

So you again conflate me with the national party, simply because I disapprove of their activities slightly less than the extreme socialist/marxist/communist alternatives. They're still thieving socialist cunts, just marginally less obnoxious thieving socialist cunts, slightly less likely to destroy the country, as socialists everywhere always do.

Yeah yeah whatever tories are great everyone else is evil.It was a massive co-incidence The whole time national was in power you constantly crowed about how great everything was and our rockstar economy and so forth and you now expect people to believe you dont have a right wing bias. Nice one.
You claimed NZ was the every of the world but failed to mention 1/3 of or children were living in provety you crowed about our raking and our ave age of death increasing but failed to aknlowdge they were once far higher ranked in the world.
https://www.kiwibiker.co.nz/forums/s...heerful/page28
I have to laugh, I dont spend hours on anything, it take mere seconds to effectively disprove the made up crap you post FFS. Seconds.

[neels]

Heres the thing the oceans and the Bobs never mention
Is you can claim the interests paid on the mortgage as a deduction on your taxable income when it run through a business.

That's rather a simplistic view.

In actual fact, you have income and expenses, one of which is interest.

If your expenses exceed your income you make a loss, which previously you were allowed to subtract from other income, so assuming you were making over $70k you could get a tax refund of 33% of the amount of your loss.

This doesn't include mortgage principal, so you are actually paying the amount of the loss plus the amount of the mortgage principal payments out of your own pocket for the privilege of managing a rental property for the bank, and if you're lucky getting a couple of grand back as a tax refund.

Of course now that these losses can no longer be offset against other income, they will be accumulated against any future income, so will probably be a great means of reducing any CGT liability when a property is sold.

[husaberg]

That's rather a simplistic view.

In actual fact, you have income and expenses, one of which is interest.

If your expenses exceed your income you make a loss, which previously you were allowed to subtract from other income, so assuming you were making over $70k you could get a tax refund of 33% of the amount of your loss.

This doesn't include mortgage principal, so you are actually paying the amount of the loss plus the amount of the mortgage principal payments out of your own pocket for the privilege of managing a rental property for the bank, and if you're lucky getting a couple of grand back as a tax refund.

Of course now that these losses can no longer be offset against other income, they will be accumulated against any future income, so will probably be a great means of reducing any CGT liability when a property is sold.

Not not simplistic its it is a fact you can claim the the interest when its a rental as a legitimate operating cost. They are deducting the interest from their income. This is fine a a normally accepted business practice.
Yet when its you home its not a deductible cost. Nor should it be.
What the CGT is designed for is to close a loophole that lets someone profit from the capital gains of selling a property tax free when it been operating as a business rather than a residence.
The bobs and the Oceans can scare monger all they like but by not mentioning or acknowledging these basic fundamental differences you can tell they only wish to scare monger and not debate on the relative merits.
If it was interest in the bank or profit from shares or other income from a business this is all taxed as income.

[Ocean1]

Yeah yeah whatever tories are great everyone else is evil.It was a massive co-incidence The whole time national was in power you constantly crowed about how great everything was and our rockstar economy and so forth and you now expect people to believe you dont have a right wing bias. Nice one.
You claimed NZ was the every of the world but failed to mention 1/3 of or children were living in provety you crowed about our raking and our ave age of death increasing but failed to aknlowdge they were once far higher ranked in the world.
https://www.kiwibiker.co.nz/forums/s...heerful/page28
I have to laugh, I dont spend hours on anything, it take mere seconds to effectively disprove the made up crap you post FFS. Seconds.

Amazing, you see tories under every bed. Gotta hate dem evel tories. What you read is more or less the opposite of what I wrote. Again.

Again: I don't have a right wing bias, I have an abhorrence of money grubbing socialist behaviour from any government, national, labour or winston first. In some cases it's simple vote buying and in other's it's driven by ideology, but the outcomes are all the same.

And like I said, if you think your opinion holds more weight than the UN's multi-metric annual HDI survey results then your every bit as deluded as your incoherent ranting indicates. And if you're using labour's definition of "poverty", which requires that everyone over 14 years old owns a cellphone then you're as intellectually crippled as they are. Now fuck off, I'm sick of your rabid, infantile ravings.

[Ocean1]

Not not simplistic its it is a fact you can claim the the interest when its a rental as a legitimate operating cost. THey are deducting the interest from their income. This is fine a a normally accepted business practice.
Yet when its you home its not a deductible cost. Nor should it be.
What the CGT is designed for is to close a loophole that lets someone profit from the capital gains of selling a property tax free when it been operating as a business rather than a residence.
The bobs and the Oceans can scare monger all they like but by not mentioning or acknowledging these basic fundamental differences you can tell they only wish to scare monger and not debate on the relative merits.

I think Bob and Ocean have already indicated several times that they don't give a fuck, you simply don't listen.

If the costs of investing in a residential property goes up then either the income from that source goes up accordingly or we'll put our money somewhere else. I already have.

[mashman]

Thoughts on the CGT.

An excellent tool................. for the entrenched to justify their entitlement. What's not to love about it.

[JimO]

Thoughts on the CGT.

An excellent tool................. for the entrenched to justify their entitlement. What's not to love about it.

entitlement? reward for risk i say