Not the time for tax – Key
Former Prime Minister John Key says imposing another tax on farmers now for greenhouse gas emissions won’t achieve much.
The Tax Working Group has recommended the Government look at introducing a capital gains tax.
The Tax Working Group (TWG) says its recommendation stems from concerns about the structure, fairness and balance of New Zealand’s tax system.
Group chair Sir Michael Cullen says the system has many strengths but there is a clear weakness caused by our inconsistent treatment of capital gains.
“New Zealanders earning just salary and wages are taxed on their full income but we have several situations where you can earn income from gains on assets and not be taxed at all.
“All members of the group agree that more income from capital gains should be taxed from the sale of residential rental properties. The majority of us on the group, by a margin of 8-3, support going further and broadening that approach to include all land and buildings, business assets, intangible property and shares.
“We have judged that the increase in compliance and efficiency costs is worth it if we can reduce the biases towards certain types of investments and improve the fairness, integrity and fiscal sustainability of the tax system.”
The TWG recommends that a tax on capital gains would kick in when an asset is sold or changes hands and would be applied with no discounted tax rate and no allowance for inflation.
Gains would be calculated from when any new law comes into force.
Three members prefer for this to apply only to residential rental property.
Sir Michael says the group has presented the Government with choices and options rather than a rigid blueprint.
“The Government doesn’t necessarily need to make a straight call over whether or not to adopt the group’s preferred model for taxing more capital gains. It could choose to apply it to only some types of assets or stagger the inclusion of different assets over time. It may decide to apply the deemed return method to property. All these options are open to the Government.”
The TWG estimates that broadly taxing more income from capital gains will raise roughly $8 billion over the first five years.
“If the Government chooses to proceed down this path, it then unlocks opportunities to reduce taxes in other areas so we have given them some options to consider,” says Sir Michael.
Angus Barr and Tara Dwyer of The Wandle, Lone Star Farms in Strath Taieri have been named the Regional Supreme Winners at the Otago Ballance Farm Environment Awards in Dunedin.
OPINION: The distress that the politicians and bureaucrats are causing to the people of Wairoa and the wider Tairāwhiti is unforgivable.
Dairy
Rural banker Rabobank is partnering with Food Rescue Kitchen on a new TV series which airs this weekend that aims to shine a light on the real and growing issues of food waste, food poverty and social isolation in New Zealand.
Telco infrastructure provider Chorus says that it believes all Kiwis – particularly those in the rural areas – need access to high-speed, reliable broadband.
World Veterinary Day falls on Saturday 27 April.