Forum Archive Index - February 2002

["LWD" <larryd@xtra.co.nz>]

Any comments on todays speech by Cullen

Cheers Larry

 

Given the fiscal pressures facing the Government, I will be looking for changes that involve the highest economic payoff for the lowest fiscal cost.

In the outbound investment area, the Review captured the conundrum perfectly.

I quote:

"On the one hand, New Zealand does not want to induce our most mobile taxpayers to consider moving from New Zealand. On the other hand, New Zealand does not wish to adopt a built in tax incentive that causes people who remain in New Zealand to see a tax advantage in investing off shore rather than in New Zealand."

"But it is precisely this type of system that produces a tax incentive to invest off shore that is the international standard."

The Review's preferred solution is that investment in listed shares and securities be taxed at a standard risk-free rate of return, no matter the country of investment.

I am interested in this idea because it has the potential to make the relevant tax rules simpler, fairer and more effective. I hope to be in a position to set out in some detail the likely direction the government will take on these issues in the upcoming budget.

This is an extract from a speech that Michael Cullen, Minister of Finance, gave to the Ladies' Probus Club in Auckland on February 22.

Source: http://www.goodreturns.co.nz/article.php?ArticleID=976487085

 

http://www.goodreturns.co.nz/article.php?ArticleID=976487085