Dump CGT – it’s the best way for Labour to survive
There’s a really simple reason why a conga line of former finance ministers didn’t introduce a capital gains tax when they had the chance; they valued their lives. And their fancy well-paid jobs.
They all knew CGT was a CDW – certain death wish. It wasn’t ever discussed at Cabinet, let alone let out of the bag for a public kicking and ritual humiliation like we’re seeing now.
For some reason the words capital gains tax strike fear into us. So what does a young, principled Government, naively seeking this impossible societal fairness do?
It stupidly goes searching in full public view for answers to a question deemed simply too hot to handle for our best politicians over the previous 100 years. It’s not like they didn’t know.
If the track says No, turn back, take the advice.
It’s nirvana for National’s chief young fogey, Simon from Tauranga Street, who is privately demanding National stretch this scare campaign out well into next year.
That’s his best chance of being crowned king. That he’s crying wolf at every turn, screaming breathlessly every third sentence, doesn’t mean it’s poor policy work.
Some of our finest minds sat through the committee’s tax ordeal. It’s just the politics and, of course, the stark fact the tax would target the very hard-working mum-anddad business owners who scoff at being called rich. Stop taking from these exhausted but ambitious people. There are hundreds of thousands of them.
And finally Simon Bridges gets a Government he can grip on to and throw it around a bit.
National actually had its own tax working group, which mentioned all the same ideas 10 years ago. But this has certainly fired up Bridges, who looked chuffed at his ability to link hairy chests and capital gains into one sentence.
Truth is, this is likely to be a tax switch. Workers will get a tax cut of, say, $16 a week and mum-anddad business owners will be taxed when they sell their business, shares, farm, and the list goes on.
Is this armageddon . . . hello? No. I’m only confused because I thought we were meant to invest in businesses and not houses. Sorry, where is the incentive?
And when all is said and done, has the sky ever fallen in? On asset sales? No. On getting rid of smoking in bars? No. Won’t we be vulnerable without the ageing Skyhawks? Hardly. Answer: No.
My criticism is that Labour has failed to sell what it really wants to achieve. This was a committee working to Labour’s instruction. But it’s been hijacked with hyperbole and strong language from those opposed.
It’s called a stalking horse for a CGT.
Jacinda Ardern can communicate well, so can her finance man Grant Robertson, so they had better get on with it. They are burning capital as you read this. Both will recall the smacking debate where the opponents defined the language.
So why not talk tax cuts, start selling the tax switch now. National did a tax switch by reducing income tax rates and hiking GST after John Key said GST won’t go up.
Labour whispers the words ‘‘revenue neutral’’. It should just shout out ‘‘tax cuts’’. Thing is, they really don’t believe in them either.
It’s officially taboo in New Zealand politics to talk about a capital gains tax, a bit like suggesting superannuation should be means-tested. We have to grow up. Why can’t we have a mature debate about Labour’s one-term death wish policy? Whoops, that’s not grown up.
Capital gains, now they sound OK, we like them, tax-free gains on our houses basically . . . leave them there, but the tax bit? Yuk, we say.
The gains have been tax-free for decades, we’re used to this yawning, hypocritical gap in the tax system.
Hey, hands off our free money. For many Kiwis, the house appreciated so much over the past 20 years it earned more than they did.
Most New Zealanders have been clear in the polls that this CGT idea can go rot in hell, perhaps with National’s nuclear policy review paper from a decade ago.
Gawd, remember that? Sadly, I’m paid to remember such odious little things about stinky policies that simply need to be shown a barrel of acid before disappearing from public life.
So what’s the link? Sometimes politicians get so consumed on such unpopular or toxic ideas or subjects that they lose sight of the obvious thing to do. Dump it. Cut and run. Survive.
When National buried its nuclear policy review three inches deep into where the sun doesn’t shine, only then did questions about nuclear issues go away. Nuclear was for a time National’s Achilles heel.
Now Winston is in the middle again, making no such assurances that his dislike for a CGT is a lifelong thing. He can be trusted in secret negotiations, right? Sure.
So let’s just calm the farm, before it gets taxed.
‘‘My criticism is that Labour has failed to sell what it really wants to achieve.’’