Kerre Woodham: Just introduce a capital gains tax and be done with it

For the love of all that is holy - can we just introduce a capital gains tax and be done with it? 

I am so sick of it dominating the headlines. The issue is never ever, ever, ever, ever, ever, ever going to go away, despite two Labour Prime Ministers ruling it out, despite Christopher Luxon ruling it out - it comes up. It's like a nagging child, “I want a capital gains tax. I want a capital gains tax, I want a capital gains tax, I want a capital gains tax”, and then in the end you give in.

This time it's because ANZ's Chief Executive, Antonia Watson, said in an interview yesterday that “the time has arrived for a capital gains tax”. Well, the time actually arrived with the Tax Working Group's recommendation in recent times, but nonetheless. She says look, there might be compliance costs introducing a tax, she also made it very clear she was opposed to any tax on unrealised gains, but she says a capital gains tax should be introduced and it should be introduced now. And her intervention adds another voice in a growing group of New Zealanders, influential and otherwise, who are calling for a capital gains or wealth tax.  

As I say, the issue really came to the fore when the tax working group, chaired by Sir Michael Cullen and convened by the Ardern government, recommended a CGT be introduced. But then NZ First dug in their toes and refused to budge, so Jacinda Ardern ruled it out and she didn't just rule it out, she said it would never happen on her watch as Prime Minister, and it didn't. Then Chris Hipkins became Prime Minister leading a Labour government, and he ruled it out too. But that was then, and this is now. Now he's singing a different song as he was to Ryan Bridge on Early Edition this morning” 

“I think what we've got to acknowledge is at the moment the New Zealand tax system is loaded against working people. Working people end up paying more tax because we're not taxing other forms of income as our other comparable countries do. There’s capital gains tax here in the UK, there's capital gains tax in Australia, and so many other countries, that there isn't in New Zealand and what does that mean? It means that salary and wage earners, the people who work hard every day for a living, end up paying a disproportionate share of the tax because we're not taxing other forms of income.” 

Oh, Chris Hipkins, champion of the working man. Where were you when you had a government that had a mandate to do anything at jolly well liked? Oh, that's right, you were there and you ruled it out. This is the same Chris Hipkins who had the best opportunity of any government since MMP was introduced to reform the tax system, he had a cabinet that was champing at the bit to reform the tax system. This is the Chris Hipkins who said no to a capital gains tax. David Parker resigned over the fact he said no to a capital gains tax, he resigned his portfolio - “untenable for me to continue”. Grant Robertson admitted he'd had to swallow a dead rat by standing by his Prime Minister when he wanted to introduce a capital gains tax. This is the Chris Hipkins who released a statement saying I am confirming today that under a government I lead, there will be no wealth or capital gains tax after the election, end of story.  

So this is why you cannot have former Prime Ministers leading in opposition because they have absolutely no credibility when their statements from only a few months back come back to haunt them. His credibility on his capital gains tax is shot. Barbara Edmonds, get her up there talking about it, she's untainted. She doesn't have the ghost of Chris Hipkins from yesteryear, well, yestermonth, coming back to haunt her. Carmel Sepuloni. Hell, Jim, the guy who serves the drinks at 3.2, get him up there to say I think a capital gains tax would be fabulous.  

You cannot have Chris Hipkins calling for a capital gains tax, he has absolutely no credibility. But the issue is simply not going to go away. And I think sooner rather than later, we need to adopt. I even think Sir Michael Cullen's recommendations were not unreasonable. There will come a time where it will be introduced, and we need to do it credibly and not in a knee jerk reaction, and with the best interests of the entire country at heart. 

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