With some concerned about how to pay for the government’s stimulus package and new budget, some have proposed that a capital gains tax (CGT) is somewhere we should look. Prime Minister Ardern has ruled out ever introducing a capital gains tax, but it’s a position her party formerly held and something her 2020 coalition partner may not feel the same about. Craccum asked a few students about what they thought about a capital gains tax.
“Introducing a capital gains tax to New Zealand is something I definitely stand with. Our housing market has already been fucked up for some time now, and all the time I hear people chatting away: “Go into the housing market”, “huge investments”, “my friend made 40k” “it’s easy as”. What about our integrity and fairness? I completely agree with trying to make a profit out of something profitable, but when do we draw the line?”
“Nowadays as a young person, it’s a fantasy to own a house in Auckland. Implementing a tax on capital gains could lower the inflated housing market and could be balanced with a reduction in taxes on income. And no Karen, calling me soft and saying back in my day is not a proper reply.”
“Someone who innovates and creates value deserves to reap the rewards of their time and energy investment. However, owning a second, third or fourth investment property and investing in the stock market doesn’t meet this criteria (Depending on what is considered value). Yet, here in New Zealand, people do both of these and we herald them as entrepreneurs or business savvy masterminds. I am not sure what a CGT I would support resembles, but I do know that the negative effects caused by such activities cannot continue.”
“Aotearoa is marred by an unfair economic landscape and tax regime. A CGT that explicitly seeks not to punish homeowners or middle-income Kiwis, but rather to raise billions of dollars in tax revenue and discourage investment in assets that fail to benefit the public, is a necessity to combat the inequalities brought to the forefront by this crisis.
I – and all Kiwis – have seen the ongoing impacts of the COVID-19 pandemic, as another global recession draws near, job losses and falling household incomes will widen the gap between the rich and the poor. Formidable frontline workers under the height of lockdown, from doctors to grocers, will see their valiant efforts rewarded with only modest one-off pay increases. All the while, their income will be taxed, whereas profits acquired via the assets of the affluent and powerful remain exempt. One must hope that this September’s general election will enshrine a more progressive consensus along the government benches.”
“Before COVID-19 I would have said yes, I support a CGT. Right now, we need more investments in the economy, otherwise the alternative is to sell our SOEs, to hope that consumer confidence will go up or inevitably increase our taxes. How do we pay for mental health services, education and benefits without the government getting into more debt? I mean we could tighten and increase taxation on property and real estate because those assets fuck with the ability to access adequate shelter, which is a human right. But I’m not sure that would still resolve the true purpose of the CGT, which is to increase the fairness of the tax system. But right now, in these circumstances, we shouldn’t be introducing a CGT.”