so pay tax

Unfortunately Govt. wont sign a binding Tax Deed with its citizens. Why Not?.

I think I’m correct in saying that Hong Kong has one. Cactus may be able to tell us.

(1) I am one of the “legitemate avoiders” Bill hates so much. I’m very good at what I do, but I’m pretty hopeless with the tax forms & returns. SWMBO is is much better at the record-keeping and returning that the IRD love. She expects more than the occasional kiss on the cheek for her efforts so, naturally, she is a 50% partner in the business. Fair enough, says I. Tax avoidance, says Bill. Fuck Off, Bill, says I. The alternative is for me to work part-time, earn a boat-load less income and therefore pay a boat-load less tax. Does he want (up to) 33% on the $x,xxx I make now, or on half of the $x,xxx I might make to bring me under the 38 cent threshold?

(2) If you want to increase the tax take, start collecting that which is due but not paid. GST is supposed to be collected and retained “on trust” for the IRD. A regime which provides the Commissioner with similar powers that exist in Australia would be a good start. Damien Grant got it in one in the Herald: http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=10605403&pnum=0 You could even start by targetting the odious industry of property development. A corporate entity for each ghetto the scumbags build, swiftly wound up with assets transferred to the next corporate entity before the IRD gets its slice. The amount of unpaid tax owed by scumbag property developers is enough to make any tax collectors eyes water.

So, Bill, until you’re prepared to reduce the top rate back down to 30 cents (as a minimum), until you’re prepared to give the Commissioner appropriate powers to pursue the real scumbags, and until you stop all the wealth redistribution bullshit your supposedly centre “right” government is engaging in, you can fuck right off.

like ACT wanted before they lost their nerve and ran to the safe conservative middle ground.

The problems that aren’t addressed is that resource consent, particularly around freeing up sections of land, makes development a slow and costly business. I’ve recently been looking at buying a section around Wellington and both times the price tag (with GST) was around $250,000. That is absurd, in that a house going for $375,000 represents (even if the land is $215,000 without GST) a capital value of less than half the property. So 650 square metres of land is, apparently, to be valued at $385/m2. That is a far greater problem, from a development cost and housing cost perspective, than flats being sold to rental investors (there has been a political push towards flats too, again through resource consent and district planning).

So I wouldn’t levy our problems solely, or even primarily, on tax. While flattening the tax system would certainly make shares and bonds more attractive (as the income would be taxed less), and a property tax might increase the disincentive to invest in land, it does not deal with the availability of credit or restrictive planning laws which caused the housing boom. If you look at th countries which have had the most aggressive property price rises you’ll notice that planning restrictions are in force in all such countries and always increase the user costs (whether through flats, which are more expensive to live in through service costs, or by requiring homes to be build on in marginal areas where resource consent has been granted over a lengthy application period). If you’re worried about property prices, and the debt it’s helped create, I’d look more to the RMA and our monetary policy (not to mention an ever expanding state which created over-employment and ever rising population numbers).

You are talking Govt expenditure, I specified tax. Here’s the OECD table which makes my point, although this latest one shows the UK has now pipped us.

Stephan,

I noted English speaking because the Anglosphere is a recognised entity with shared culture, ex colonies, more similar recent development histories and many other points of comparison.

http://www.oecd.org/dataoecd/48/27/41498733.pdf

JC

Similar arguements apply to applying a tax on those using the NZ currency as a casino. Brazil has done it because the see the Real as being groslly overvalued which is killing their exporters- if japanese households want to use us a their bankers- as least we could get some benefit for it.

People on six figure incomes were looking like paupers on paper, though they were ploughing their surplus income into negatively geared properties. They would get a nice big refund at the end of the financial year, which co-incidentally would be sufficient for a deposit on a new property.

Developers sprung to service this newfound demand for properties (like apartments), fueled by a tax system that penalised savers and rewarded property speculation.

Reduce the tax rates, and its likely that developing will also drop to reflect the fact that fewer people will find it necessary to salt away income via negatively geared property. Developing will then match growth at a more sedate rate.

It might do the sharemarket a world of good, plus other investments like corporate bond to reduce the top tax rate. People are unable to borrow for shares and bonds like they can for real estate investments, or depreciate for that matter. It might make investing a bit more rational (IE, focused on yield and growth, rather than doing it to shelter income from the IRD)

Just because other countries are stupid enough to have high marginal tax rates that encourage avoidance doesn’t mean we should do the same.

Of course people will always look for ways to avoid tax but if you equalise the rates and tax all sources of income equally then the problem is bound to be a lot less!

No wasteful and inefficient WFF. No envy rate. Top personal rate under 30%, say 25%. No gargantuan explosions in welfare and student bribes, no Families, childrens, race commissions etc.

Every person should pay towards their community. Taxes and rates are a few paying for the many.

The idea of a kind of tobin tax on currency would be very problematic to implement and the cause of currency fluctuations is something which can be dealt with through other means (including non-interventionalism – that is we could stop intervening and let markets actually price our currency, rather than artificially trying to attract capital through high interest rates). If we simply say that trading in NZD incurs a tax you’d have ever poor sod and his dog relocating the business of trading our currency offshore, of which much is already done, and that would put it squarely outside of our tax net. The only truly effective way to achieve this would be to make the Kiwi non-convertable except in NZ and that would be something which I don’t think I could stomach (it would, if nothing else, put us back a while). So a currency tax, while attractive sounding at first, seems to be transferring responsibility away from investment, planning, and interest rate policies and putting in place another tax which would be a nightmare to administer.

I think English is right to be addressing this issue, I’m just hoping that it means we start with alignment, rather than more ‘anti-avoidance’, or another ‘regime’, or we introduce an IRD ‘crackdown’. I’m just praying that this matter is resolved peacefully and with our long-term best interests in mind, rather than a reaction to a perceived ‘problem’ (as if not giving your money to the Crown were that).

Fuck them. In 2000 Clark increased the top rate to 39% because though it wouldn’t raise that much revenue Labor polling told them that their low earning voters resented those with higher incomes. Labor increased tax rates to keep their retard voters happy.

Rob Salmond

UK: 21% (if income under STG300k) to 28% (if earnings over STG300k) corporate; 40% personal.

None of these places align the rates. None. Surely they have other methods for tackling tax avoidance, no?

The UK has dependencies under it that constitute some of the worst offenders for offshore services. For example, through its subsiduaries in Jersey, the Isle of Man and the Cayman Islands, Barclays avoided tax worth around £1bn to the UK government in the past few years by working the funds through Crown dependencies. Around 40% of the world’s offshore companies are located in the British Virgin Islands and there are very few restrictions and lots of loopholes on personal earners.

The method of tackling tax evasion in the UK is make up that side of the balance sheet with higher rates of taxation on lower earners (they recently eliminated the 10% tax rate but are introducing a 45% tax rate). Otherwise, if you have the money then you’re fine.

No matter what mechanism you use- people will always come up with ways to avoid paying. My other suggestion would be to tax the casino currency money that makes NZ the tenth most traded currency in the world. That is what Brazil has done. This depresses your currency and property market- but would that be a bad thing? It was real estate speculation that triggered the GFC. At least your exporters and tourism operators would then have chance. It would be good for home buyers though it may reduce the supply of capital for a short time (ie you would need to phase it in).

Will the trust crackdown apply to ones owning family homes in Karori?