Scoop has an Ethical Paywall
Work smarter with a Pro licence Learn More

Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 

Five Reasons Why David Parker Should Abandon A Death Tax


As Inland Revenue investigates New Zealanders’ inherited wealth, the New Zealand Taxpayers’ Union is warning the Government against taxing this wealth via a death tax.

Taxpayers’ Union Campaigns Manager Louis Houlbrooke lays out five reasons New Zealand doesn’t need a death tax:

Incentives: A death tax would discourage New Zealanders from saving and investing their earnings. Less capital would be built up as older New Zealanders choose to spend their savings instead of building an economic legacy for future generations.

Fairness: A death tax is a double tax. Someone would spend a lifetime giving up their earnings via income tax, only to have their remaining earnings taxed again as savings upon their death.

Complexity: The biggest beneficiaries of a death tax would be accountants and tax lawyers, who would be engaged by the wealthy to thread investments through complex exemptions and loopholes in the tax, such as exemptions for farm assets, trusts, and gifts prior to death.

Revenue: Any revenue from a death tax would be meagre. Of the OECD countries to have implemented death or gift taxes, an average of just 0.5 percent of total tax revenues is generated by those taxes. This means that even if our government decided to make a death tax revenue neutral by cutting income tax, the income tax cut would be nearly imperceptible.

Problem definition: A death tax, or indeed any kind of wealth tax, fails to address the actual causes of rising inequality: specifically the shortage of housing which has pumped up the value of assets held by the upper and upper-middle class.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

© Scoop Media

Advertisement - scroll to continue reading
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines


Gordon Campbell: On The US Opposition To Mortgage Interest Deductibility For Landlords


Should landlords be able to deduct the interest on the loans they take out to bankroll their property speculation? The US Senate Budget Committee and Bloomberg News don't think this is a good idea, for reasons set out below. Regardless, our coalition government has been burning through a ton of political capital by giving landlords a huge $2.9 billion tax break via interest deductibility, while still preaching the need for austerity to the disabled, and to everyone else...
More


 
 

Government: Concerns Conveyed To China Over Cyber Activity
Foreign Minister Winston Peters has confirmed New Zealand’s concerns about cyber activity have been conveyed directly to the Chinese Government. “The Prime Minister and Minister Collins have expressed concerns today about malicious cyber activity... More

ALSO:


Government: GDP Decline Reinforces Government’s Fiscal Plan

Declining GDP for the December quarter reinforces the importance of restoring fiscal discipline to public spending and driving more economic growth, Finance Minister Nicola Willis says... More

ALSO:


Government: Humanitarian Support For Gaza & West Bank

Winston Peters has announced NZ is providing a further $5M to respond to the extreme humanitarian need in Gaza and the West Bank. “The impact of the Israel-Hamas conflict on civilians is absolutely appalling," he said... More


Government: New High Court Judge Appointed

Judith Collins has announced the appointment of Wellington Barrister Jason Scott McHerron as a High Court Judge. Justice McHerron graduated from the University of Otago with a BA in English Literature in 1994 and an LLB in 1996... More

 
 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels


 
 
 
 

Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.