Let’s tax this. What are we in for, Labour?
On the cusp of the election, voters are still in the dark about what taxes they might be hit with if Labour is part of the next government.
A tax (“royalty”) on water is confirmed. But Jacinda Ardern has refused to rule out a capital gains tax, a land value tax, and an asset and wealth tax – other than to say the family home is exempt.
“For Labour to say they’re not able to be more explicit about what they have in mind until they have recommendations from the yet-to-be-named members of a tax panel is something of a cop-out, and certainly doesn’t help voters,” Federated Farmers Vice-President Andrew Hoggard says.
For farmers, their home and surrounding land also happens to be their business and livelihood. “Even if an exemption applied to the farmhouse, they’ll cop it from new taxes far more than their urban cousins.”
The prospect of a land tax in particular is alarming to the rural sector, in that it would have a severe impact on land extensive businesses and others that are so-called ‘asset rich and income poor’.
The last time a land tax was considered (2010), the agricultural taxable land base was $105 billion, meaning a 0.5% land tax would cost farmers $525 million per annum – a massive hit on the sector, and thus on regional economies and rural towns.
“Farmers already pay whacking rates bills in many parts of the country, often disproportionate to the services they are delivered or actually use,” Mr Hoggard said.
“Labour delivered more detailed information on their water tax proposal when pushed into it by Federated Farmers, Irrigation NZ and other groups.
“Voters deserve more details on Labour’s preferences for other taxes before they go to the polls.”