MPs will rise above own CGT interests

The debate on capital gains tax has a long way to go but one issue should be dispelled from the beginning. Nobody’s point of view should be written off as self interest simply for the fact they own, or do not own, assets that may be taxed.

This applies particularly to members of Parliament.

Three-quarters of the National caucus and two-thirds of the Labour caucus have an interest in investment properties, as do twothirds of NZ First. This is the asset most likely to be taxed and it is better that decision-makers’ personal interests are publicly known than be the subject of conjecture and suspicion.

Self-interest, of course, cuts two ways. If those with property have an interest in opposing the tax, those without property have an interest in supporting it.

One reason to discount personal interest in this debate is that if a capital gains tax is adopted, there will be plenty of time for investors to sell the assets tax-free if they wish. The Government has indicated that if it adopts any of the suggestions of its Tax Working Group, it will not come into force unless the Government — or at least Labour and the Greens — return to power at the election due in the latter part of next year.

But the better reason to ignore accusations of personal interest is that our politics is better than that. The vast majority of MPs have entered politics with a driving sense of the national interest and that sense is deepened as parliamentary work exposes them to the complexities of policy decisions and the consequences.

Self-interest, of course, cuts two ways.

This is not a corrupt democracy and nobody should listen to cynics not well acquainted with it. Most people’s opinions are not solely motivated by self-interest. If they were, we would not be seeing opinion polls with a majority opposed to capital gains tax. Most people cannot afford investment property or even so much as a holiday bach, a fact the National Party leader overlooked when he called a capital gains tax an attack on the “Kiwi way of life”.

Those without investment property who oppose that tax are doing so from an objective sense of what is “fair”. They sympathise with those who have worked hard to build up a business, often drawing little income from it in tough times, and feel it is only fair they should receive its full value when they sell it.

The Tax Working Group has taken a different view of what is fair, arguing that wealth should be taxed equally regardless of how it is accumulated. That is the debate, it is more important than personal interest.