Fran O’Sullivan writes:
Jacinda Ardern has the momentum at the 2017 election, but she should stop the charade and issue a detailed capital gains tax policy. …
But all we hear from Ardern is the mantra that she is “being transparent” with the public by saying Labour will put capital gains taxes on the working group’s agenda to give a “direction of travel”. This is disingenuous.
Particularly as Ardern has indicated that instead of seeking an electoral mandate on September 23 for new capital gains taxes, Labour will simply seek the working group’s advice and then (in all probability) introduce the taxes in its first term in Government.
It is almost inevitable that Ardern, if elected, would introduce a Capital Gains Tax. But she won’t tell us any details of it, including what the rate will be. So a vote for Labour is a vote for whatever type of Capital Gains Tax they decide in Government to implement without an electoral mandate for.
She has stipulated that Labour will ring-fence family homes from the new regimes. But what about businesses and farms which are integral to New Zealand’s productive sector?
In Labour’s 2014 election policy, the first $250,000 of gains would have been tax-free if the seller was aged over 55 and had personally owned the business for more than 15 years. Then a 15 per cent tax would apply on the capital gain from sales.
Is that still the case? Or does Labour intend more swingeing reforms?
Capital gains taxes are complex. They can be blunt instruments.
Lots of vital details are needed such as what the rate would be. What about when your parents die – is their house suddenly taxed?
Then there are the water levies and tourist levies (still to be announced).
Again, how hard is it for Labour to introduce some certainty for farmers by spelling out the size of the water levy?
Farmers have been told Labour is proposing a levy of 1 or 2 cents for each 1000l of water that farmers use.
But the party will consult with farmers on the exact size of the levy once in office.
Farmers deserve some certainty – 2c on 1000l would be twice the cost of a levy of 1c per 1000l.
Would it not make more sense for Labour to put the levy at 1c per 1000l and reassess its effect at a later date?
Fundamentally, this “trust us” approach is insulting.
The only reason I can imagine that Labour won’t reveal what the rates of their water and capitain gains taxes will be, is they think they will lose votes if people realise how high they will be.