Roughan in fantasy land

Jacinda Ardern Taxes meme

John Roughan seems to think that taxpayers will like the proposals about to be released from the Tax Working Group (TWG). They won’t.

Half of the country is up in arms about a capital gains tax (CGT) already… but Roughan thinks it is a great idea. He doesn’t realise that just about everyone will pay CGT at some point in their lives. What if your parents leave you a house, John? The taxman will take a third of its value. Are you okay with that? quote.

Just three more sleeps before we see a capital gains tax proposal. I’m excited. At long last the days may be numbered for easy, excessive, socially damaging and economically unproductive investment in houses in this country. end quote.

You do realise that CGT will apply to the sale of shares and businesses, don’t you, John? Obviously not. quote.

In fact, the interim report suggested it will recommend capital gains be taxed at the receiver’s top personal income rate – which would be fairly radical but eminently fair. end quote.

If this approach was ’eminently fair’, why does every other country with CGT use either a flat rate or a lower rate for CGT? quote.

It might also mean that when the final report is made public on Thursday we might be offered income tax cuts, not just at the lower rates but the top rate too. end quote.

We all know how much Michael Cullen loves ‘rich pricks’? The first thing he did when he became minister of finance was to INCREASE the top tax rate to 39%. quote.

Another reason all income tax payers might get some good news on Thursday is that the Government would need to sell a capital gains tax package to voters at next year’s election and capital tax could give it an annual $6 billion to reallocate. end quote.

That money will never be redistributed to taxpayers. Most likely, it will go towards keeping Shane Jones’ nephs on the couch. quote.

But the best reason to lower the top tax rate is that 33c is too high. Cullen’s group doesn’t think so, its interim report told us income taxes here are low by international standards.?.

end quote.

33% is not a high top rate by world standards. Obviously though, it is too high for John. quote.

Would energetic, enterprising people still borrow money or put their savings at risk to employ themselves, would they have the same incentive to build up the business and become responsible for employing others, if they were going to lose a third of its value when they wanted to sell it? Business lobbies will say no – but they would say that. end quote.

They would say that because it is true. Most business owners make huge sacrifices while building up their businesses, and the prospect of CGT taking 33% of the proceeds of a sale will be a disincentive for some. That means less jobs, less exports, less productivity. Is that what you had in mind, John?

Here we get to the crux of the matter – for Roughan anyway. quote.

I wish a capital gains tax could be confined to residential rental property. Strictly, that offends a core principle of liberal economics that government should not discriminate against any private investment decisions but multiple house buying has done the country no good and a lot of harm.

A Newspaper. end quote.

John Roughan wants a CGT because he wants to see ‘rich prick’ landlords suffer. The social damage that the current politics of envy is causing is enormous. Typically though, John is a self centred socialist. He thinks he deserves a tax cut, and that private landlords should pay through the nose for it.

There will be no cuts to the top tax rate, John. That is a complete anathema to the thinking of the current government. If anything, they will increase it. This is Michael Cullen we are talking about here.

John… you’re dreamin’.