Te Pati Maori’s bonkers tax plan
Te Pati Maori has announced the following as part of their tax policy:
- A top marginal tax rate of 48%
- GST of 15%
- A 2.5% tax on assets above a certain threshold
- An increase in the company tax rate by 5%
Let’s say you are a very high wealth NZers with $100 million of assets. Let’s say they produce income of 5% of their value, or $5 million a year. Very roughly the tax they would pay would be:
- Income tax of $2.4 million
- GST of say $350k
- Asset tax of $2.5 million
This would see that high wealth NZers paying an effective tax rate of over 100%. Now unless they are a moron, they would simply leave NZ. And then the actual tax paid in NZ would zero.