Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Ministers reject 'misleading' tax claims

13 April 2006

Ministers reject 'misleading' foreign investment tax claims

Finance Minister Michael Cullen and Revenue Minister Peter Dunne today rejected what they say are 'misleading' claims about the effect of the new rules announced this week for taxing New Zealanders' earnings on overseas investments.

"Both GPG and ABN-AMRO Craigs continue to assert that thousands of New Zealanders who hold overseas investments outside Australia will be hit hard by the new rules," the Ministers said.

"They claim such people, not necessarily wealthy and sophisticated investors, who hold shares directly will have to pay tax on 85% of the unrealised capital gains on their investments. That is incorrect.

"Individuals whose investments cost $50,000 or less and couples whose holdings cost up to $100,000 will not be affected by the new rules.

"GPG also claim that institutional investors such as managed funds will be worse off after the proposed changes. Again this is misleading ? bordering on untrue. Managed funds are already paying tax on their capital gains on investments like GPG. The proposals don't increase this tax ? they reduce it because only 85% of the capital gain will be taxed.

"The two companies also talk about a tax on 85% of the unrealised capital gain, without adding the important qualification that any such taxes for individuals will be capped at 5% of the increase in value.

"Perhaps the true reason for GPG's comments in particular come towards the end of the company's statement when it pleads for a special exemption from the rules, on the grounds that it's a great New Zealand company.

"GPG is not registered in New Zealand, it's registered in the United Kingdom and its call for a special exemption makes no sense in terms of tax policy or fairness," the Ministers said.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines


Sector Opposes Bill: Local Government Bill Timeframe Extended

The Minister of Local Government Peseta Sam Lotu-Iiga has asked the Select Committee to extend the report back date for the Local Government Act 2002 Amendment Bill (No 2). More>>


Breed Laws Don’t Work: Vets On New National Dog Control Plan

It is pleasing therefore to see Louise Upston Associate Minister for Local Government calling for a comprehensive solution... However, relying on breed specific laws to manage dog aggression will not work. More>>


Not Waiting On Select Committee: Green Party Releases Medically-Assisted Dying Policy

“Adults with a terminal illness should have the right to choose a medically assisted death,” Green Party health spokesperson Kevin Hague said. “The Green Party does not support extending assisted dying to people who aren't terminally ill because we can’t be confident that this won't further marginalise the lives of people with disabilities." More>>


General Election Review: Changes To Electoral Act Introduced

More effective systems in polling places and earlier counting of advanced votes are on their way through proposed changes to our electoral laws, Justice Minister Amy Adams says. More>>

Gordon Campbell: On Our Posturing At The UN

In New York, Key basically took an old May 2 Washington Post article written by Barack Obama, recycled it back to the Americans, and still scored headlines here at home… We’ve had a double serving of this kind of comfort food. More>>


Treaty Settlements: Bills Delayed As NZ First Pulls Support

Ngāruahine, Te Atiawa and Taranaki are reeling today as they learnt that the third and final readings of each Iwi’s Historical Treaty Settlement Bills scheduled for this Friday, have been put in jeopardy by the actions of NZ First. More>>


Gordon Campbell: On The Damage De-Regulation Is Doing To Fisheries And Education, Plus Kate Tempest

Our faith in the benign workings of the market – and of the light-handed regulation that goes with it – has had a body count. Back in 1992, the free market friendly Health Safety and Employment Act gutted the labour inspectorate and turned forestry, mining and other workplace sites into death traps, long before the Pike River disaster. More>>

Get More From Scoop



Search Scoop  
Powered by Vodafone
NZ independent news