“In the end, yesterday’s announcement looks a lot like political theatre. As ministers, and the Reserve Bank, have rightly noted previously, CGTs don’t change the character of house price cycles, and attenuated ones like this are even less likely to. Some will feel better that ‘something is being done,’ but it will just divert attention, and policy and legislative time, away from measures that grapple with the real issues.” 1
COMMENT: It looks a lot like political theatre to this government, and last weeks’ Reserve Bank meddling makes it a two-cast drama. But while its off-Broadway now, a diversion, now that the door to CGT has been opened it will soon become main-stage centre-Broadway.
“What strikes me about the government’s new tax – which is totally not a capital gains tax <sarcasm>– is that (a) it will probably not deliver … because property speculators can just defer their sales to avoid the tax [for now], but (b) [because] there is now a ‘brightline’ tax on capital gains instead of a huge nebulous loophole … this is a big deal on a psychological and political level. It means that subsequent governments – or maybe even this one – can incrementally increase the two year limit out to five years, ten years, then no limit, and New Zealand will have a realised capital gains tax on secondary property.
Yes, the way it came about is absurd. Labour campaigned on a Capital Gains Tax. National opposed it. More than opposed – they tore Labour apart over it. So Labour abandoned it and now National’s introduced a dummy one. Someone else will give it teeth.”
COMMENT: Oh yes. They sure will. Someone else will certainly give it teeth. Big teeth.
Nobody voted for it.
A lot of you voted against it.
And you believed the blue lot when they said they opposed it. Yet here it is; the wedge just gently slipped in. all ready to be hammered home.
So who are the stupid ones here?
It’s the same ones who voted for those “meaningful” tax cuts in this Government’s first term.
You voted for tax cuts you didn’t get. And you voted against a tax you are getting.
Will you ever get the feeling you’ve been cheated?
1. This comment is by Michael Reddell at the Croaking Cassandra blog. Unfortunately, he concludes by revealing himself to be anti-immigration. So, there’s that.
2. The comment is Danyl’s at the Dim Post blog. His analysis is spot on. His evaluation however is 100% removed from mine; he calls it Progress!
1 comment:
Anti large scale immigration if we can't sort out the supply restrictions. The latter is clearly first best.
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