David Thompson Posted:
So very, very true. It beggars belief that we consider ourselves to be a developed nation when so much of our economy is based on selling milk powder or logs. BTW, I own a Plinius amplifier (my second) that drives a set of Theophany speakers.
(view article + comment)
David Thompson Posted:
A robust but sobering report. It concerns me that confidence is rising, yet sales and exports are down and "manufacturers and exporters are still lagging behind other sectors". Surely we should wait until we're earning more money before we start spending more?
(view article + comment)
siemens Posted:
Yes true! The only thing that will never die in this world is the nature and its science behind it. Great post.
(view article + comment)
Kieran Ormandy Posted:
Thanks for the question Steven, Germany has seen increases in manufacturing employment since 2009, and Switzerland has had stable manufacturing employment between 2006 – 2011, even in the face of ongoing Euro-zone issues. Korea has seen increases in manufacturing employment since 2008 and Israel experienced large increases since 1998, while being stable over the last 4 years. Singapore has had increases in manufacturing employment over the last two years. These countries all value their manufacturing sectors and work to protect them, this is reflected in the above numbers and their performance through the GFC. Note data around the above examples was sourced from OECD labour market stats.
(view article + comment)
John Walley Posted:
Point one: you should have no doubt what our Association says publically represent the views of our members. Point two: we don’t knee jerk responses, if you trace back our comments around NZPower you will see them link all the way back to our research in 2004 and 2005. All that material is fully linked from our comments above. Point three: you will note our comments on major users, sadly the same advantage does not accrue to smaller industrial users. The perverse incentives of the LRMC approach in all this are well known. Point four: the NZMEA is not like any other Association in New Zealand we admit only manufacturers and exporters into membership, and our public expressions are the views of that restricted membership.
(view article + comment)

Recent News

House price increases slow as new lending rules begin to take effect - QV - Stuff Business, 1 Nov 2016 New Zealand's hot housing market is showing signs of cooling down.

Global debt hits $152 trillion - New Zealand Herald, 6 Oct 2016 Global debt has hit a record high of US$152 trillion (NZD$217 trillion), weighing down economic growth and adding to risks that recovery could turn into stagnation or even recession, the International Monetary Fund has warned.In...

Business owners confident in economy - survey - 3 News Business, 4 Oct 2016 Kiwi businesses were more optimistic about the state of the economy and their own activity in the September quarter, even as their profits were squeezed. ...

Households losing wealth as debt keeps going up - Stuff Business, 4 Oct 2016 New Zealanders have become poorer over the past year.

Signs of challenges for exporters - NZMEA survey - Voxy, 6 Sep 2016 The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during August 2016, shows total sales in July 2016 decreased 15.27% (year on year export sales decreased by 20.48% with domestic sales decreasing by 6.03%) on July 2015.

Ad enquiry


Capital Gains Tax pros and cons explored

Print-friendly 10 comment(s) Posted in: 3rd party

Craig Elliffe and Chye-Ching Huang from the University of Auckland Business School have written a series of articles for the Herald on the merits of a Capital Gains Tax in New Zealand.  The first article looks at whether the tax changes introduced this year were wide ranging enough, the second discusses the benefits of a Capital Gains Tax and the third examines the most common reasons for the rejection of a Capital Gains Tax with reference to South Africa which has recently introduced the tax.

These are the three articles:

The reasons for a Capital Gains Tax mentioned included base broadening, fairness and progressivity through corresponding cuts to income and corporate tax.

The last article responded to criticisms of the tax by concluding that:

"Before 2001, South Africa, like New Zealand, considered and rejected capital gains tax over and over again.

The same objections to capital gains tax raised here had been raised there: assumed complexity, lack of revenue, and a tendency to degenerate over time.
In 2001, South Africa's policymakers got off this hamster wheel by looking carefully at the international evidence.

They found that common objections to capital gains tax were not supported by other countries' experiences. New Zealand has yet to look carefully at this international evidence.

We should. The fiscal situation demands further reform to the tax system to avoid a debt mountain.

The tax changes in last year's Budget did not do enough to address that looming problem.
While some have called capital gains tax political suicide, fiscal suicide is also unattractive.

South Africa's experience shows that a capital gains tax can be designed to alleviate political objections, while keeping it simple and delivering its well-known benefits."

tags: capital gains tax, craig elliffe, chye-ching huang


4 Comment(s)

DGS - 30 December 2011 at 12:38 PM
All you have to do is look at what economies are the most successful in the world and emulate what they do. Hong Kong is the #1 economy in the world and has no capital gains tax. So much for common objections to capital gains tax not being supported supported by other countries' experiences. The higher the Cap gains tax, lower the level of economic activity and success. This is a fact in the real world. Theory is for academics...most of them have no clue about real world application of economics. Thank you.
DGS - 30 December 2011 at 12:40 PM

Last modified: 30/12/2011 12:41:27 PM
AD - 18 October 2012 at 18:38 PM
and while we're at it lets make all of the US a city and a conveniently located trade-hub. Then we can have the government seize all land and get its revenue from leasing it. Oooo and we can stop supporting a military too. Hong Kong isnt doing well because it has a low capital gains rate, They have not found conclusive evidence of a correlation between the CGR and growth.
MH - 19 October 2012 at 12:19 PM
Let’s to be clear, Hong Kong is not a country, and it always had support from other larger economy, pre-1997 there was Britain, and now China. Hong Kong may not have a CGT, but compared to New Zealand, it has more favorable geographic location and their exchange rates are more stable, which are crucial to the economic growth. CGT is not a fix for all, but it may be an appropriate tool for the NZ government to increase tax revenue and housing affordability. Many developed and developing countries have CGT, and without it New Zealand has become a tax haven for speculators.

Website URL:
Remember Me:
Email Replies:
Please play the ball not the man.