The coalition government’s tax working group has now delivered its final report on the future of tax in NZ, including a recommendation on a capital gains tax.
The report recommends that capital gains tax would apply to gains and losses after the sale of a residential property (including holiday homes), businesses, shares, all land and buildings but tax would not be applied to the family home, or the land it sits on. Cars, boats and art would also be exempt.
Among other key points, the report recommends that there will be no changes to income tax rates but that the threshold is raised to allow for low and middle income groups to earn more at a lower rate. The report also includes recommendations on environment taxes such as changes to emissions trading, congestion charging and waste disposal levies.
What happens next?
The government will now assess the report and an official response is due in April. Any new taxes would come into effect from April 2021, at the earliest, with the tax to be applied to gains and losses made after this date.
We will be keeping abreast of any changes so we can advise you of any impacts.
To read the full report, click here.