11 March 2019

“The debate over the Tax Working Group’s recommendations will not quench Kiwi’s thirst for a decent tax system” says Opportunities Party Leader Geoff Simmons.

“Discussions have predictably divided along party lines, with little depth of thought or accuracy. It is like trying to irrigate dying crops by giving hyperactive kids water pistols.”

Here is a brief summary of the poor thinking spraying on all sides:

National: Amy Adams claimed that a Capital Gains Tax is “double taxation”. We already tax the returns on other investments like businesses, bank deposits, Kiwisaver and shares, so why should housing be any different? If National are to have any credibility on this they need to present a way to reduce taxes on bank deposits, businesses and Kiwisaver to zero.

The current tax system is patently unfair because we tax some returns and not others; National needs to accept that. The problem is that the Tax Working Group’s recommendation won’t fix the problem. We won’t even start on Simon Bridges’ hyperbole about the “Kiwi way of life”.

Greens: The Greens really have tied their own shoelaces by painting the Capital Gains Tax as a win for the poor. By exempting the family home the poor will face much higher rents, and there won’t be enough revenue to compensate for them for it. This Capital Gains Tax is really designed to benefit the middle class, not the poor.

Labour: They got us in this mess by ordering the Tax Working Group to exempt the family home. No tax on the income from assets is going to work if you exclude our biggest asset class – the family home makes up 42% of all Kiwi assets.

New Zealand First: They have already said they would exempt farms in a clear sop to their disgrunted target voters. What justification do they have for treating farms differently to investment properties? The business models are basically the same – write off as many expenses as possible to minimise taxable income and cash in when you sell.

Our tax system is driving rising inequality, high house prices and poor economic performance. Sadly none of the options currently on the table do the job. The Opportunities Party has a proposal that would solve these issues, but there are other ideas out there. We urge all politicians to step back from partisan politics and reconsider this important issue with an open mind.

The Opportunities Party has already held one session to discuss tax in Wellington and will be holding another tonight in Auckland.

-ENDS-

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