14 July 2011

“A Capital Gains Tax is a step towards making the rich pay the tax they should, but it won’t fix the rot,” says Vaughan Gunson, Tax Justice campaign coordinator.

“While capital gains taxes are very common around the world,” says Gunson, “they’re also considered quite easy to avoid.”

Gareth Morgan, while in favour of an CGT for New Zealand, admits that “Tax dodging on capital gains taxes is simple” (see ‘Capital gains tax best way to tackle rot,’ ‘http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10737829, 14 July 2011)

“Easy avoidance of capital gains taxes is one reason international campaigners for tax justice are promoting a Financial Transaction Tax (FTT),” says Gunson. “That’s where the real buzz is.”

The internationally coordinated Robin Hood Tax campaign is doing a lot to promote the idea of a global FTT (see http://robinhoodtax.org/). While in New Zealand the Mana Party is calling for a 1% FTT, which they’ve branded the “Hone Heke Tax”.

Tax Justice is advocating a Financial Transaction Tax, because it’s the best way to tax international and indigenous financial speculators who currently pay zero tax on their trading.

Mr Gunson says the pros of a Financial Transaction Tax are that it’s difficult for the rich to avoid, it’s low cost to implement, and it’s very progressive.

“It’s only the rich who speculate in financial markets or have elaborate schemes for moving money around to avoid paying tax,” says Gunson. “There the ones that a well designed Financial Transaction Tax could net billions of extra tax revenue from.”

Tax Justice has been collecting signatures for a petition that requests Parliament to remove GST from all food and tax financial speculation instead. The petition, which has close to 40,000 signatures, will be presented to the Labour MP for Mangere, Su’a William Sio, on Tuesday 16 August.

For more information on the Tax Justice campaign go to http://www.nogstonfood.org/

ENDS

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