Originally Posted by
Bjauck
I disagree that any burden would end up being spread more evenly.
(a) It is manifestly unfair on those who earn income from interest bearing stock, and who in high interest times are already paying a substantial amount of tax, even though their economic returns may well be negative.
(b) It would not particularly shift the burden more onto the particularly rich or wealthy, who have more equity investments.
(c) Having a variable top tax rate would be more difficult to plan for. It could mean a less certain investment environment and Possibly a disincentive to investment, other than in investments that provide capital gains. Also a greater inv-cent I’ve for finding income tax minimisation schemes.
(d) The main windfall gains in NZ from government policy and economic conditions is by way of capital gains.
(e) We need to encourage rather than discourage more household saving and investment for income. We need to encourage more bonds and funding for business expansion.
(f) It would make the need for fundament tax system reform even more pressing.
(g) Cheaper more plentiful housing requiring fewer over-indebted households is needed.