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17th July 2011, 05:38 | #121 | |
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17th July 2011, 10:47 | #122 | |
Love, Actuary
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If you like you're comparing every high income earner in NZ against almost no high income earners in the UK and then claiming things look okay. If you make the comparison using almost every high income earner on both sides then the assessment shows that NZ looks terrible. labour lie like this absolutely deliberately. Surely you're not like them? Also, if you're going to pick countries that are not remotely like NZ to undertake comparisons with then why not choose ones with very little tax rather than ones with lots? Or be balanced and pick a range for comparison? Last edited by Golden Teapot : 17th July 2011 at 10:51. |
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17th July 2011, 11:00 | #123 | |
Love, Actuary
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17th July 2011, 11:02 | #124 |
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You're not as extraordinary as you think you are.
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17th July 2011, 13:40 | #125 |
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If we are going to tax married couples on combined income where its advantageous to them, shouldnt we tax every married couple on combined income the so-called "marriage penalty" tax.
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17th July 2011, 20:03 | #126 |
Love, Actuary
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Does anywhere in the world do this?
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17th July 2011, 22:07 | #127 | |
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I also either mentioned or implied that I was comparing NZ with western countries (not just UK). If you compare us with *most* western european countries you will find we have very low tax, even if we had 39% tax > 150k, and especially if you use the euro as a comparison which normally sits around 0.5 NZD. I don't care enough to find all of the numbers for you, that's normally your job, isn't it? The UK was simply used because I have the numbers in my head. However as you *should* know most of europe has similar tax levels. Asking whether I am "like" those people at Labour? I don't think I am "like" anybody, I simply look at their policies. I could vote for Labour if I decided they looked okay. I dislike political divides on religious grounds (you seem rather religious). |
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18th July 2011, 00:04 | #128 |
Love, Actuary
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Didn't you basically give two explicit examples? One was an extremely unusual country (in terms of the society that their tax is supporting) and for the other you explored the tax calculation in a manner that applies only in the minority of cases. It's almost like you're comparing the worst case scenario overseas against the best case scenario here.
If income splitting were introduced in NZ then I imagine you'll agree that the legislation would comply with the Human Rights Act too? I know it doesn't have to but it would be ever so difficult to enact legislation in this space unless it did given our parliamentary system. That being the case then wouldn't virtually everyone potentially affected by the maximum income threshold be entitled to claim they were married for tax purposes? What's the case in the UK in regards to this type of thing? Why didn't you choose Canada for the opposing side of your argument? You stood a chance of getting somewhere had you done that. |
18th July 2011, 00:07 | #129 | |
Love, Actuary
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18th July 2011, 00:17 | #130 | |
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18th July 2011, 00:34 | #131 |
Love, Actuary
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Well technically - but I've not been there for more than three decades.
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18th July 2011, 04:41 | #132 |
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GT what would be very interesting to hear from you is what your view is on how the tax system should be structured and why.
And then also why you feel the NZ tax system should differ so greatly from other countries (give a couple of examples). Your position is basically not known (to me at least) right now and it would be helpful to understand that. |
18th July 2011, 09:29 | #133 |
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There was an article the other day on Pundit comparing top tax rates.
http://www.pundit.co.nz/content/tax-...s-for-a-change
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Protecting your peace is way more important than proving your point. Some people aren't open to cultivating their views. Just let them be wrong. |
18th July 2011, 13:29 | #134 | |
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Stay shook. No sook. |
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18th July 2011, 19:59 | #135 | |
Love, Actuary
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18th July 2011, 21:18 | #136 | |
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18th July 2011, 21:49 | #137 |
Love, Actuary
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Well you have to start with an open question if you want me to play. I mean that second clause of yours gives the game away don't you think?
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19th July 2011, 00:18 | #138 |
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They look like a couple of fairly open questions to me .
"GT what would be very interesting to hear from you is what your view is on how the tax system should be structured and why. And then also why you feel the NZ tax system should differ so greatly from other countries (give a couple of examples)." I don't think that either of those are herding you into any particular response. It could be disappointing to realise that you are simply trolling as one of your earlier comments seems to suggest. Trolling/tickling, same thing! But, I'm losing interest as I don't like to debate without the other party being willing to table their own viewpoints. |
19th July 2011, 07:46 | #139 |
Love, Actuary
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The second question isn't open. But lets not have you waste a page of this thread on this.
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19th July 2011, 11:54 | #140 |
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Here's an open question: why are you such a cock?
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Stay shook. No sook. |
19th July 2011, 12:11 | #141 | |
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I would suggest that it was intended however as an invitation to explain how you think the tax system should be structured in terms of how it differs from existing systems... Unless of course you think the current system is fine?
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Ξ √ Ω L U T ↑ ☼ N وكل يوم كنت تعيش في العبودية |
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19th July 2011, 12:30 | #142 | |
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19th July 2011, 13:02 | #143 |
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Thanks for the quote.
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Stay shook. No sook. |
19th July 2011, 16:00 | #144 | |
Stunt Pants
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And it's only mid-afternoon :/
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
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19th July 2011, 16:07 | #145 |
Objection!
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A smart tax would be a land tax on residential or investment properties of substantial value, e.g. say a million dollars. They can go and exclude farms if they like. However, it seems to me the advantage of such a tax would be that it's relatively harder to avoid than the CGT that Labour is proposing and there will be more certainty as to how much tax will be collected in the short to medium term.
In the ideal world, such a tax might discourage people from pouring excessive capital into homes/residential investment, without hitting the supply of so called family homes excessively. Even if wealthier people aren't discouraged from building and buying "palaces", the tax base at least grows. |
19th July 2011, 16:53 | #146 | |
get to da choppa
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..."And in other news today, houses in the $999,999 - $1,150,000 price bracket disappear off the market." |
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19th July 2011, 17:31 | #147 | |
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19th July 2011, 19:43 | #148 | |
Love, Actuary
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19th July 2011, 21:21 | #149 |
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Perhaps I phrased it incorrectly then. It was indeed an invitation, and yes I did imply that I think you believe the NZ tax system should differ from other western countries.
I don't think it's unfair to assume you do think it should be different, given most of your comments in this thread. Is that an incorrect assumption? It's interesting that you attempt to bog down the discussion with semantics. You are fully aware of what the intent of the questions was yet you choose to use an argument that they weren't "open" enough for you to respond. Why don't you rephrase the questions in a way that you would find appropriate, and then answer them? |
19th July 2011, 23:25 | #150 | |
Love, Actuary
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But at least we're down to the question applying to only Western countries - it was all countries earlier and I'll be honest and reveal I've no idea what happens in Togo or other places I'd personally have difficulty pointing out on a map beyond vaguely what continent they fall within. If you really want to know: 1. Income tax on a progressive basis with a moderate top rate under 40%. 2. The option of income sharing to achieve somewhat similar outcomes on a family basis. 3. CGT at the top tax rate on all appreciating assets plus a bit more to allow for tax having been normally deferred. 4. Death/gift duties on appreciating assets to achieve an effect like the CGT. And most importantly everyone pays according to the formula with no nonsense tolerated. So, not very radical I'm afraid. Last edited by Golden Teapot : 19th July 2011 at 23:26. |
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19th July 2011, 23:40 | #151 | |
Stunt Pants
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Why tax at the top rate? If you've only made a small profit on the sale of the asset, isn't the top tax rate a bit much? Why not apply progressive tax on capital gains?
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
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20th July 2011, 00:15 | #152 | |
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I.e. you can focus your attention on your appreciating property portfolio (let's say, working on improvements), and assuming you turn a very tidy profit on this kind of activity you could end up paying less tax than you would have on plain income tax. In other words you need to consider the individual's (or couple's) total income including capital gains to obtain a full view of how much they should be taxed. I am kind of getting into a segue now but it raises the question of whether or not capital gains should be tied with personal income, however I think it would be far too complicated to do this in a fair way. The simpler option from an administrative perspective is just to tax it at the top tax bracket - it's not perfect but it works. |
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20th July 2011, 00:22 | #153 | |
Stunt Pants
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
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20th July 2011, 00:51 | #154 |
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Yes - but as I noted, using brackets with CGT would be a nightmare. Especially since they may not fall neatly into a given tax year and given their interaction with the individual's other income.
I started thinking a bit more about this and the following case study probably illustrates the complexities. Consider two people: 1) Person 1: earns 250,000 NZD per year purely on capital gains (has no PAYE tax) 2) Person 2: earns 250,000 NZD per year working a full time job and paying PAYE Then to complicate things: Clearly it is unfair on person 1 to charge CGT at the top rate (person 2 would pay less tax due to the bracketed system). What if person 1 earned nothing in the past 5 years and all of a sudden earned 500,000? Do you then look at the tax brackets allowed for the past 5 years and retrospectively tax them based on this? How would you test this, and how would you police this? I'm not sure how it is in New Zealand but are losses on capital tax deductable? What if a person earns based on a mixture of capital gains and personal income? Yes - you could theoretically address most of this by tying personal income and capital gains together and trying to work out an effective tax bill but imagine the work this would cause for IRD. The complexity in my opinion kills it which is why I think a plain top tax bracket CGT is the way to go. Although the hypothetical person 1) above might get a bit screwed by this I think there are not many people who don't have some measure of personal income combined with capital gains and therefore you could view their capital gains as being part of their top tax bracket anyway. |
20th July 2011, 01:10 | #155 | |||||
Stunt Pants
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I started thinking a bit more about this and the following case study probably illustrates the complexities. Consider two people: Quote:
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Anyway, I'm not sure we totally understand each other. I'd rather hear GT's explanation.
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
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20th July 2011, 01:50 | #156 | |
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Income up to $14000 taxed at 10.5% Income over $14000 up to $48000 taxed at 17.5% Income over $48000 up to $70000 taxed at 30% Remaining income taxed at 33% This means Person 2 would pay $73,420.00 in tax, while Person 1 would pay $82,500 (i.e. the whole lot at the top rate of 33%). Unless I missed something... |
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20th July 2011, 01:54 | #157 |
Stunt Pants
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That's actually exactly why I'm asking if it would not be fairer to tax capital gains in brackets rather than at the top tax rate. The reason I'm confused is because charismo is - to be honest - doing a piss poor job of outlining his thinking. Your explanation makes much more sense and matches what I was thinking.
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
20th July 2011, 02:15 | #158 | |
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You're confused because it's complicated.
In the case of someone earning 500,000 nzd in one year but his property appreciated over the course of 5 years, how can you use a bracketed tax system? He _realises_ the 500,000 gain in one year but it appreciated over a 5 year period. If we use a bracket system then he gets taxed for the most part at 33% (everything over 70,000 NZD which means he pays 33% tax on 430,000 NZD). Rather close to just having a flat 33% CGT all along in this example, but at the expense of a whole lot of added complexity and cost for IRD and hence the tax payer. Think about what happens if you actually consider him to have "earned" that 500,000 over the whole course of the 5 years (for instance, average it ie 100,000 per year), and mix it up with his normal personal income. Would you just add the two numbers together and _then_ use a bracket system? Certainly this is the fairest way to do it to get the full benefit of a bracketed system? How complex would that be? Quote:
I apologise for the rather murky posts now. There are basically 2 things I am trying to communicate: 1) It's too complex and costly to implement anything else other than a flat rate CGT 2) Setting CGT lower than top tax rate introduces a way to avoid the top tax rate |
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20th July 2011, 03:04 | #159 | ||||||
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But what I'm getting at is if it's a bracketed tax system, let's say the same rates and brackets as income tax. Make a profit of $14,000 on a house - pay 10.5% tax. Make a profit of $32,000 - get taxed at 10.5% on the first $14,000, 17.5% on the remainder. So it's more equitable, right? Sure, if the intention is to discourage property investment then, by all means - wallop a high flat tax rate on a capital gain. However, taxing progressively on a capital gain would still be a disincentive to invest in property whilst taxing at (arguably) a fairer rate. Again, if the intention behind a capital gains tax is to reap a substantial return then by all means, slap a high flat tax rate on - which is where we go once again back to my question to GT regarding his reasoning behind taxing flat rather than progressive. Quote:
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I just want to understand this, sir. Every time a rug is micturated upon in this fair city, I have to compensate the owner? |
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20th July 2011, 03:54 | #160 | |||||
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By contrast using the top tax bracket for CGT means you eliminate having to worry about this at all. Quote:
Last edited by Charismo' : 20th July 2011 at 03:55. |
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