More on those envy taxes

"Those who claim our tax system is unfair and fosters inequality typically quote Scandinavian countries as operating superior tax systems. The interesting thing is the top 10% of taxpayers in New Zealand pay a bigger share of the tax burden than their equivalents in the Nordic countries, at over 45%. Our northern counterparts have their top 10% shouldering less than 40% - even as low as 35% - of all income taxes paid.

"The same shrill calls for a heavier tax burden on the wealthy rarely want to look at the “net” position of taxpayers. We know that the top 10% of taxpayers are contributing as much as 75% of the tax burden after transfers for Government outgoings are netted off.

"Of that 10%, the top couple of percent are [already] carrying an enormous load. ...

"The level is already in the danger zone when relocation is factored in. It is very easy for the wealthy to move out, taking their innovative, entrepreneurial, employment-creating skills, leaving the rest of us to pick up more of the tab.

"Here's something for promoters of a capital gains tax to consider. The CGT tax collected in Australia in the last couple of years has fluctuated wildly, with as much as 70% swings. Meanwhile the cost of raising a dollar of CGT in the poor years has exceeded 75% or $0.75 cents for every $1.00 raised. Avoidance levels are running over 30% against a pure model, with significant distortions emerging having a negative effect on investment decisions.

"Taxing capital may make the envious feel better, but it doesn't do much for the country."

~ Owen Jenning from his post 'Tax is a means to an end, not an end in itself'