More tax for country's 14 billionaires 'inevitable'

The National leader said Kiwis should be able to spend their own money rather than have Grant Robertson spend all of it on their behalf.

The number of billionaires in New Zealand has risen to 14, including individuals and families, who collectively hold wealth of $36.8 billion, according to NBR’s latest Rich List.

The richest of them, Graham Hart has wealth of $12b.

The newest arrivals to the billionaire club are Sir Peter Jackson and Dame Fran Walsh thanks to the $2.3b sale of Weta Digital last year.

Of the 14 richest New Zealanders, only former Xero chief executive Rod Drury had his wealth decrease over the past year. The wealth of 11 billionaires increased, and two stayed the same.

But a tax expert said the uber-wealthy needed to start paying their fair share of tax, before wealth inequality became baked into the economic system.

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Tax consultant Terry Baucher​ said with an infrastructure deficit and climate change to reckon with, the way New Zealand taxed the wealthiest individuals needed to change.

Sir Peter Jackson and Dame Fran Walsh are the newest billionaires.
Sir Peter Jackson and Dame Fran Walsh are the newest billionaires.

“Treasury has said that in the coming years we will need more tax, so where is that going to come from? We have to change our mix of tax, that means that some sort of taxing the wealthier more is inevitable,” Baucher​ said.

Baucher​ said the New Zealand tax system was unusual on the global stage, because a large amount of tax was collected through GST and income tax, while property holdings, often a person’s most valuable asset, were virtually untaxed.

It can be hard to watch your KiwiSaver balance decline.
John Kirk-Anderson/Stuff
It can be hard to watch your KiwiSaver balance decline.

While it was inevitable that billionaires needed to be taxed more, the boundary lines around how much more, and how the tax would be paid still needed to be worked out, he said.

“If we don’t think hard about the way we tax capital, then wealth transfer will just become hereditary and inequality will become baked into our economic system.”

Infometrics chief forecaster Gareth Kiernan​ said new billionaires could become a more infrequent occurrence over the next 18 to 24 months.

“In the near future I think there will be very few people increasing their wealth, with interest rates rising as they are,” Kiernan​ said

While there was some economic benefit to having billionaires operating in your economy, the foremost benefit was to themselves, he said.

“Billionaires are the type of people looking for opportunities to grow their wealth, which by its nature can feed through into more employment and incomes.

“But I wouldn’t want to under emphasise the possibility that you are still getting uneven distribution of wealth. They may be creating more wealth, but they are also capturing an outsized share of it.”

New Zealand’s 14 billionaires

Graeme Hart – $12b

Todd family – $4.3b

Goodman family – $3.5b

Mowbray family – $3b

Sir Michael Friedlander – $2.1b

Sir Peter Jackson and Dame Fran Walsh - $1.7b

Talley family - $1.6b

Bruce Plested - $1.45b

Rod Drury - $1.3b

Sir Robert Jones - $1.15b

Rod Duke – $1.1b

Manson family – $1.1b

Mark Stewart – $1.05b

Peter Cooper – $1b

Source: NBR’s Rich List.