It was only a matter of time before someone suggested introducing a Capital Gains Tax. The NZ Labour Party are preparing to hit us with just such a scheme if they win the November election. Where else was there to go?
On the other hand, in order to glean more votes, the same people have decided to ease the tax burden by not charging a Goods and services tax (GST) (or VAT in the U.K) on vegetables. This has to be wonderful news for vegetarians and vegans.
A recent and quite disturbing advertisement on the telly, depicting vegetables being played as musical instruments has encouraged many people, in the unlikely event of a change of Government, to think along the same lines.
Every time a new tax is introduced some tax avoidance whiz kid discovers a way around it or a way to take advantage of it. All legal and above-board of course. The answer to this ‘no GST payable on all vegetables’ scheme is to milk it for all it's worth. So here's the plan...
Drive around in a pumpkin, it was okay for Cinderella. Sounds ridiculous but a friend of mine who owns a golf driving range in the Medway towns of England cleverly disguised his Mini as a great big golf ball clearly an innovative idea that NZ's could emulate
The possibilities are endless...
Purchase a banana boat with no GST to pay.
Tax on clothing would be avoided if the ladies wore grass skirts and coconut bras and the guys donned cabbage leaves.
Diamonds would be a tax free investment, think carrots.
Instead of a weekly wage, think monthly celery.
I shall not apologise for the somewhat pathetic vegetable puns they are a fair match for the proposal.
On a more serious note, a Capital Gains Tax is unlikely to put money in the IRD kitty in the foreseeable future. We all know that properties purchased a couple of years ago have not yet reached their original value, and will probably not gain a cent for a few more years, so no capital gain there.
Here’s a thought: Why penalise investors and folk who want to better themselves and are prepared to endure the risk of failure, by taxing them on such schemes? These people will be punished through paying personnel tax as well as a C.G.T. whereas the ‘live today and don’t worry about tomorrow’ people will be left alone, tax free. If you are determined to tax people on any gain acquired, why not have a look at, cars, boats, art works, in fact every item that is bought then sold at a higher price.
I have the answer, clear and simple. We need a similar tax to the one introduced in England hundreds of years ago. Such a revenue gathering system will put new light upon the subject of a fair tax for New Zealand. It is a tax that represents a window of opportunity, transparent and well worth looking in to. Simply called, ‘The Window Tax’.
This so called Window tax was introduced in order to raise money from the wealthy, without upsetting them. Many people in Britain opposed the idea of an income tax, saying that it was an intrusion upon their privacy. The populace opinion was that the Government of the day had no right to force any one to disclose their personal income (yes, times have changed). The new tax consisted of two rulings, a flat-rate house tax of two shillings per house and a variable tax for the number of windows amounting to more than ten windows. Of course the tax dodgers would take pains to brick over all windows exceeding the ten exemptions in order to pay less tax.
Typical of the prideful attitude of ancient, wealthy aristocrats, instead of bricking in their windows they put in as many as possible. This was done to demonstrate to their peers that they were extremely well off. Today’s equivalent in such one-upmanship would be to tow your new Lamborghini behind your new Bema. Either way when you consider the glass palaces of our major cities, such a tax could be very lucrative.
An intriguing aside to the story is that the English language was embellished by the window tax because it gave rise to the saying, ‘daylight robbery’, which some would agree is a fitting description for the NZ Labour Party’s proposed Capital Gains Tax.