Parliament

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

 

CGT valuations would pile on costs, benefit no-one

Simon Bridges - Leader of the Opposition

12 March 2019


Valuing every single business, farm, rental property or family bach to comply with a Capital Gains Tax regime would impose billions of dollars of costs on New Zealanders while benefiting no-one apart from valuers, Leader of the Opposition Simon Bridges says.

“The Tax Working Group recommends small businesses, rental properties, family baches and farms be subject to a Capital Gains Tax (CGT) on all gains made after April 2021. As a result, eligible assets without an up to date market value would need a new valuation.

“Valuations don’t come cheap, especially for business owners who want a value robust enough to stand up in court if challenged by the IRD. If every small and medium-sized business owner in New Zealand had to pay for a new valuation at say $10,000 apiece, the cost to the wider economy would be about $5 billion.

“Remarkably, that’s roughly how much a CGT is projected to raise in its first four years. That isn’t fiscal neutrality, it is economic stupidity. It adds costs just to tax growth.

“Every small business owner, farmer and property owner would want to maximise the valuation on ‘valuation day’ to limit the tax they have to pay on future capital gains. Such an incentive would ultimately undermine the credibility and fairness of the tax system.

“Other proxies for assessing the valuation of properties - such as local authority rating valuations (RVs) – are unlikely to be used as they typically understate the true market value and would therefore increase any future CGT.

“Mass automatic valuations have also been suggested as a way to avoid the compliance cost of valuations, but these should be ruled out because they would inevitably create significant errors and inequities in some cases.

“The huge compliance costs required to implement the recommended CGT are yet another reason why it would be disastrous for the New Zealand economy.

“National believes New Zealanders should keep more of what they earn and will fight the Government’s proposed tax grab every step of the way. We will repeal a Capital Gains Tax and we will not introduce any new taxes in our first term.”

ends

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Ellen Rykers on The Dig: Community Conservation – The Solution To The Biodiversity Crisis?

There are backyard trapping networks doing their bit for Predator Free 2050, farmers planting native trees along their waterways, and iwi protecting whenua rāhui. There are 62 biodiversity sanctuaries across 56,000 hectares, with around two-thirds of them community-led. There are citizen scientists counting birds in their backyards and landowners conserving habitat in 3,500 Queen Elizabeth II National Trust covenants.

It’s increasingly clear that a government agency alone cannot combat the biodiversity crisis successfully. These grass-roots initiatives are a growing resource in the conservation toolbox. More>>

Closing This Weekend! Have Your Say On The Issues For NZ's New Biodiversity Strategy

Scoop and PEP invite you to help decide how we should protect and restore our biodiversity over the next 50 years using Scoop’s online engagement platform, HiveMind. HAVE YOUR SAY HERE>>

Biodiversity HiveMind Preliminary Progress Report
Open data report summarising preliminary findings of the Biodiversity HiveMind. Read Progress Report Here>>

 

PM In Japan: Jacinda Ardern’s Remarks Following Abe Summit

Today we discussed a wide range of topics. Broadly the themes were: a deeper, high-value trade and investment relationship, greater cooperation in the Pacific; and strengthening our security partnership. More>>

ALSO:

Replacing All But Chair: Twyford Appoints Five NZTA Board Members

Transport Minister Phil Twyford today announced the appointment of five new members to the NZ Transport Agency Board... There remain two vacancies on the NZTA Board which will be filled in due course. More>>

ALSO:

Climate Change: Adaptation And Risk Assessment Framework Released

“We are already experiencing the effects of a changing climate such as coastal inundation and increasingly frequent and severe droughts, floods, fires and storms. This framework is an acknowledgement that we must start adapting”, James Shaw said today. More>>

ALSO:

Ihumātao: Mana Whenua Reach Decision On Land

Māori King Tūheitia says mana whenua have finally reached consensus over what to do with Ihumātao - they want it back. More>>

ALSO:

PM To Japan, New York: Ardern To Meet Trump During UN Trip

“I’m looking forward to discussing a wide range of international and regional issues with President Trump, including our cooperation in the Pacific and the trade relationship between our countries." More>>

PM's Post-Cab: "A Way Forward"

At Monday's post-cabinet press conference, Prime Minister Jacinda Ardern announced a number of actions in response to the Labour Party's mishandling of sexual assault complaints. More>>

ALSO:

Gordon Campbell: On Allegations Of Left Wing Media Bias

“Left wing bias” accusations date back at least to the mid 1990s... The charge of left wing bias was ridiculous then, and is ridiculous now. More>>

Next Wave Of Reforms: Gun Registration And Licensing Changes Announced

“The Bill includes a register to track firearms and new offences and penalties that can be applied extraterritorially for illegal manufacture, trafficking, and for falsifying, removing, or altering markings – which are a new requirement under the Firearms Protocol.” More>>

ALSO:

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels