The rates bill I pay to just one of the three councils I have to deal with is slightly over three times my salary. You're flogging the horse to death. Who's going to pull the cart when it dies?

Guy, not knowing one acronym suddenly makes someone unqualified? I would consider myself at least if not more qualified to comment than most of the others who do so, and with every bit as much, but no more, right as they to do so. I am intelligent and fairly economically, financially and politically literate. Knowing what I don't know is more of a strength than not.

Rex, in attacking me mindlessly you've proved my point beautifully. Poor farmers indeed, that's exactly it. Every country is built on the backs of it's poorest workers, and in NZ that is far and away the farmers. Farmers are the only professionals in NZ who do not value their time. I personally contributed $1.2m to the economy last year, and yet was able to pay myself only $14k. My hourly rate would work out to approximately half of minimum wage, ignoring the fact that the work I do is far beyond that of the majority on minimum wage, with all overtime and weekend work unpaid. So excuse me if the idea of yet another cut of my already slim profits being taken from me upsets me.

Mr Steinbeck #81 (With a Grapes of wrath mentality)to suggest that someone is a leech because they provide shelter for those that choose not to own their own home is absurd and offensive. There is no shortage of homes if you want to build your own, I could sell you a section :)

Almost everything revolves around property. If you punish the Landlord, the Landlord sells up and puts their money abroad.

The roll on effect: The Landlord stops building new homes. The Painter, Builder, Landscaper, concrete layer etc etc etc has no work so reduces his/her spending and buys less food, which means the packing houses fire their staff as their turnover drops. The staff stops getting cars on HP because they have no job and the government increases their benefit to compensate. Mean while the car salesman looses his/her job as does the finance company employee and so on...

There isn't more tax for the Government because Landlords stop buying. Those that do, buy less or buy offshore where taxes are more favorable and returns are higher.

Now that was clever of the Government taxing property - not!!!

In answer to Dan 76, an LAQC is a Loss Attributing Qualifying Company. Just a normal company but you've asked the IRD for 'loss attributing' status. If the business, whether it be share trading, internet marketing, or property investment, runs at a loss, then the loss can be used to reduce PAYE tax, or 'attributed' to other entities (trusts, companies, etc) in your name. Just a note on possible tax changes. I haven't read the comments, but if there are changes there will be some opportunities. Most people will jump up and down and moan and whinge about it, but a smart minority will be in there looking for discounts. Rules are rules. You learn the rules and invest accordingly. Anyone who claims high moral ground by saying they invest for the good of the country is full of it. You look after number 1, because that's human, but every 1 that isn't dependant, is another 1 who reduces the tax burden

LAQC stands for Loss Attributing Qualifying Company

Dan #76

Oh poor farmers. Go cry me a river. No, on second thoughts dont... you'd only pollute it.

LAQC = Loss Attributing Qualifying Company. And you consider yourself qualified to comment on this stuff? Pl-ease

Hi Dan #76

LAQC stands for Loss Attributing Qualifying Company.

Richard #45, Nicit #56 and SuziQ #57 excellent comments. Conversely, Geoff #62 most disgusting comment I've ever read on Stuff. Go and live in Cuba mate.

Firstly, this whole debate has shifted off context. The problem is not the NZ tax system, although changing it to a flat tax system would be the best thing to ever happen to this country. The problem is that as a proportion of GDP, NZ government spending is the highest in the developed world. It's time to cut out the crap.

Also, if we must talk property, those of you lauding Australia are correct. My brother-in-law and his girlfriend have just built a brand new four bedroom brick house for $165k. To do that in NZ would have cost four if not five times as much.

Mention of a land tax gets my hackles up though, because the ones to be most hit by this are farmers. With already only the very best, and I mean only the top 10% at most, turning a profit, and farmers already subsidising their urban counterparts significantly in terms of rates this would be hugely unfair. Someone mentioned that rental returns are only 4% at the moment - it takes an absolutely top farmer to return 2%. Please, stop hammering us. Yes, admittedly the value of our land is high (too high, and hopefully about to receive a sharp correction), but if we aren't getting any return or making any money from it, then that's a moot point.

And lastly, can someone please tell me what LAQC stands for, I've seen it twice here and don't know.

If you want to modify peoples' behaviour you provide incentives. If you provide punitive measures to prevent something happening, invariably you will fail. Increasing taxes annoys people but it does not stop them driving their car, it does not stop them drinking to excess, it does not stop them choosing to spend their money on whatever it is that they want. The Reserve bank submission to increase rates to make housing less attractive is a clear demonstration that they do not understand the first thing about anything. In any case why should you wish to modify peoples behaviour? If you want to collect expensive shoes as a hobby, why not. It provides jobs for shoe manufacturers. If you want to stockpile a fleet of expensive cars that's up to you. It doesn't create jobs in NZ but so what you earned the money. If you want to 'hoard houses' well guess what - the government wants to stop you because you've been earmarked as a tall poppy. Well I guess that's why we continue on this downward spiral... Ho hum When all the professional landlords (not me by the way) are finally driven out of business we will have HNZ investing taxpayers money into new housing developments to cope with all the homeless people. Then what? Oh yeah, they'll have to put taxes up again to pay for it all.