Taxjustice.nz launched itself at parliament last Monday. If you missed the fanfare, you were not alone. Jordan Williams, from the Taxpayers Union, quipped that there were more media people at the launch than group supporters.
I guess that just about sums it up then. Here is a photo of the launch party.
Hmmm. Jordan Williams might have a point. Quite a turnout.
Truth is, the majority of Kiwis do NOT want a Capital Gains Tax. There are lots of reasons for that, but the main one is this. Yes, there are a lot of people who have nothing, but for most Kiwis, the idea of working hard and building assets is still very strong. That is what we aspire to do. For those who say it is boomers who do not want to lose their vast wealth built up over decades, this is true, but the question is why? For most boomers, even if CGT is introduced in 2021, the bulk of their gains are quite safe, because they were made before the tax was introduced. The reason they don’t want the tax is because it is their children that will pay it when they inherit.
Yes. That’s right. The bulk of the supposed billions that could be collected in CGT will be paid by Generation X, Y and millennials.
Anyway… a poll came out on Tuesday that blew taxjustice.nz into oblivion, when it found that the vast majority of New Zealanders do not want CGT. quote.
Newshub has been given exclusive access to a Reid-Research poll commissioned by Business New Zealand that shows an overwhelming majority of voters ? 65 percent ? don’t think a CGT should be a priority for the Government.
New Zealanders do not want a capital gains tax (CGT) ? not on their investment property, not on their farms or businesses, and definitely not on their KiwiSaver.
The poll found that just 22.8 percent think it should be a priority. And nearly half of voters ? 47.8 percent ? say the CGT debate has harmed the Government, while 33.1 percent say it hasn’t, and 19.2 percent don’t know.
Business New Zealand commissioned the poll to break down the CGT and see what, if anything, New Zealanders might support.
“As we got more deeply into the different types of assets New Zealanders own, they push back pretty hard,” chief executive Kirk Hope told Newshub:
On taxing property profits, half of voters pushed back. The poll found 49.8 percent don’t think there should be a CGT on property; the family home would be exempt.
And that’s versus just 39.1 percent that support it. end quote.
So those fatcat rental property owners are not quite so hated after all. Now there’s a surprise… and a nasty one for the government. quote.
When it comes to KiwiSaver, voters say hands off. The poll found that 90 percent do not think there should be a CGT on KiwiSaver earnings. That leaves just 4.4 percent – next to no one – that support the idea.
Newshub. end quote.
This makes Paul Barber’s claim that “the majority of people support a capital gains tax” seem rather optimistic, doesn’t it?
However, there are those that are blind and will never see… and I’m not talking about taxjustice.nz here. quote.
A new report criticising the Capital Gains Tax has been dismissed by the Finance Minister. Finance Minister Grant Robertson told Larry Williams that these polls depend on how the question is asked. end quote.
It is amazing that, when there is a poll result that they don’t like, it can be dismissed as asking the wrong questions. I think the questions were pretty straightforward. It is the responses that Grant doesn’t like.
Here is another reason why we do not want CGT. quote.
The report found that the cost of implementing the tax would cost between $2.7 billion and $6.8 billion.
Robertson agrees that is a huge amount of money, but says the report’s numbers don’t stack up.
Newstalk ZB. end quote.
I have heard claims that CGT will cost more to collect than the revenue it gains. If you bear in mind that the tax will collect only modest amounts for the first 10 years or so, then this is shaping up to be another government white elephant… along with Kiwibuild, the Auckland light rail system and the zero carbon bill.
Taxes that cost more than they collect are usually shelved after a short time. There is no point in them. What is the point in introducing a tax so unpopular, when it might end up being shelved in a few years anyway?
What is the point? Blind ideology. That is what we are facing here. That is why it will happen, unless Winston, or some very bad polling for the government, manages to intervene.