What to tell the grandies

As the discussion on the CGT regime that doesn’t even exist yet ebbs and flows I can’t help thinking that the protagonists with the most to lose if it goes ahead cherry pick the arguments so much that they leave themselves open to ridicule by anyone with a modicum of logical thought.

Landlords, speculators, investors - call them what you like - are currently not shouldering their fair share of the burden.

They buy a house to rent and the tenants have to front up with their (tax paid) hard earned to cover the costs. Any costs that are not covered are passed on to the taxpayers for a subsidy (tax break).

That means that tenants and taxpayers, who are, in most cases, one and the same, are shouldering most of the costs and the "investor" picks up a sometimes quite substantial capital gain at the point of sale and pays no tax.

Couple that with the rent rises that have run parallel with the housing bubble and you can see that the "investor’s" income has risen but his costs have not, which will probably necessitate another visit to the tax accountant. Meanwhile the tenant is probably more likely to go to a budget advisory service or food bank.

This state of affairs is so far out of whack that it will ultimately not end well.

But as it is demonstrably not sustainable end it must, before the society that we live in today collapses into a shambles. What on earth am I supposed to tell my grandchildren about the society they will inherit.

Geoff Orchard, Ohaupo