Capital gains tax hot election topic

Last updated 05:00 21/08/2014

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Capital gains tax was the hotly debated issue at New Plymouth's first political forum this week.

Four election candidates spoke to about 80 people at a political panel event held by the Taranaki Property Investors Association on Tuesday night.

Audience members quizzed National MP Jonathan Young, Labour MP Andrew Little, Green candidate Sarah Roberts and ACT Candidate James Gray about their party's policy on property issues.

While new earthquake strengthening laws were also questioned, it was Labour's capital gains tax that most people had come to hear about.

They wanted to know why capital gains tax was considered necessary. For property investors, capital gains tax would mean that if a house, other than the family home, was sold for a profit, 15 per cent of that profit would be paid in tax.

Little stood by Labour's policy and told the group that people who could not afford to buy property as an investment had every dollar of their income taxed, so why should property investors be spared paying tax on an income.

"It's a matter of fairness," Little said. "And property almost always appreciates in value, so there is almost no risk, unlike other investments."

Having a capital gains tax would help to deal with the growing issue New Zealand had with income inequality, he said.

Gray, the ACT party candidate, said ACT did not support a capital gains tax.

"It is simply another measure for taking millions out of the private sector and putting it in politician's hands to use to bribe voters," Gray said.

While National MP Young was not so blunt in his approach, he too said National did not support a capital gains tax.

It had not worked in Australia, he said, and it would not take the heat our of the housing market.

Income inequality would not be fixed by it because you couldn't "lift the bottom up, by pulling the top down"

Like Labour, Roberts, the Green candidate, said the party also supported a capital gains tax.

She rebutted a suggestion from the audience that investment properties provided a nest egg for retirement.

"How many homes does the average New Zealander need to own to provide for their retirement," she said.

The four candidates also attended a political panel about education issues last night at Devon Intermediate School. About 40 people were there and a full report of the meeting will be in tomorrow's paper.

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- Taranaki Daily News


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