‘Last chance saloon’ for capital gains tax: Cullen

The Tax Working Group has reached a consensus on a capital gains tax, but it is not supported by all members, chairman Sir Michael Cullen has revealed.

‘‘We have got to the point where we have a central package around the extension of capital income tax which is supported by a clear majority of the 10-person working group,’’ he said.

Cullen said the objections among the minority who had not backed its plan were ‘‘mainly about some aspects of how you do it, rather than whether you do it’’.

But he indicated there could be water to go under the bridge before any changes were adopted and enacted by the Government.

Labour coalition partner NZ First has yet to comment on whether it would support legislation enabling a capital gains tax before the election, that would come into effect after the election.

Finance Minister Grant Robertson said ‘‘no decisions have been made’’.

Speaking at an event hosted by Victoria University in Wellington, Cullen said it was ‘‘last chance saloon’’ for a capital gains tax because the politics would get harder as New Zealand’s population aged.

‘‘There is no point trying to do it in 20 or 30 years’ time, when demographic changes have occurred, because the politics of it will be even harder because there will be an older electorate that is even less likely to support changes in capital income taxation. This is the ‘last chance saloon’ in many ways for any significant change in this area.’’

Cullen also revealed the group was on track to publish its final report by the end of January – a month ahead of schedule.