A capital gains tax is the bit above the line but there is a bit below the line - capital loss and any system is balanced - if you make a dollar, someone else loses a dollar - it is a fundamental principle that is often ignored and for the two to be equated you have a system of administration that is costly to administer. Someone pays and the fundamental "cost" is spread between the users, eg. road tax, and when the winners and losers and payers are finished, the result may be a mile away from the the original intent. A good administration tries to allow its citizens to work and trade with each other and pay taxes through a system that is clearly equitable - GST - is the perfect vehicle. If you spend you pay a little tax, every time - if you save there is no GST to pay and you "help" the country. As to housing - did you make a profit? The house and acerage I occupy - I hate to claim ownership - cost me $123,000 to purchase. I got $150,000 for half the land and then spent something in the order of $75,000 putting the present dwelling in place. So my house and land cost me $48,000 and I would $X for it, a handsome profit? no just the cost of my next place. Once again, a fertile field for lawyers and accountants to make more money. I think John Key has the wisdom to let this sleeping dog lie.