Did anybody read that? :-)
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Did anybody read that? :-)
Just a line. Add 15% capital gains tax and you just add !5% plus to the price of the house, hardly a deflationary measure. When supply exceeds demand, then the pressure eases.
Yeah never a truer word said in jest. Essential classic zorro.:t_up: Chuckling off to bed.
Thanks for that JT.
If the government can't do it, maybe philanthropic organisations and businesses can help solve the youth unemployment problem in NZ.
http://www.nzherald.co.nz/business/n...+16+April+2015
Otorohanga made something like this work for them regionally, it was done without much cash, just a network of concerned businesses and publicly elected locals.
Beats me why the Reserve Bank is stirring on a capital gains tax. Fiscal Policy very definitely belongs to Central Government, and overseas and in the past, Central Banks keep their sticky beaks out of it. Monetary Policy is the Reserve Bank's area but not totally, Central Government may fiddle around the edges and do some jawboning.
As has been pointed out a Capital Gains tax applies to the whole country, not just Auckland, and has the effect of raising property prices - do we want that? NO!
The Reserve Bank has a number of tools and it has applied just two, keeping interest rates up a bit and stopping 100% finance. The Reserve Bank is able to fine tune policy so that it can raise the deposit required/shorten or lengthen the term just on Auckland houses through its control over the banks. Why doesn't it do that instead of wringing it's hands and calling for a capital gains tax?
Gareth Morgan's approach I think makes a lot of sense, tax all housing as if it was cash in a bank earning interest.
House trading for profit is taxable. Any activity undertaken for profit is taxable. Problem is in enforcement. The govt. can have the army of inspectors to collect the taxes or, as they have chosen to do, save money by not bothering to employ the manpower and forego the tax but save the expense.It might be a lot easier if they offered significant tax advantage to industries that moved out of Auckland.
What about Mr Little's idea to require a larger deposit on second and subsequent properties? Could work and could be restricted to Auckland but would be easy to circumvent by using different entities.