Forum Archive Index - February 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

>
>
>Your points:
>a. Presumably your Remuera resident (i don't know any) has already
>paid tax on the money used to hire the Huka Lodge.
>
>


Hmmm, I think see your point here.   The Remuera resident pays for
his Huka Lodge stay from money that has already had tax taken out of
it.

Conversely our north Otago resident owns his crib at Box Bay, and
once he owns it he is enjoying a tax free benefit when he stays
there.  But wait a minute.  Didn't our North Otago man use after tax
money to buy his Box Bay batch in the first place?  So why should he
be taxed again by wealth tax, now that he fully owns the asset?


>
>
>b. My use of "beneficiaries" refers to the Myers of this world and
>not to your average Superannuitant.
>
>


Ah, so you are saying that if you become too rich you become lazy
with your assets,  so we should introduce a wealth tax to ensure that
no-one gets too rich?


>
>
>
>While we are getting away from the Cullen idea, my one
>(however unworkable) is for there to be a "notional income"
>from all assets equal to the equivalent Govt stock rate.
> That is the income that would be taxed. Not a tax on
>the asset but a tax on its notional income. End of story.
>
> 



Nice pure theory, but political considerations will never allow the
politicians to tax individual New Zealanders own homes.  So there is
one category of notional income that will always be exempt.   And if
you implement this theory, with exceptions, the markets will become
distorted, ramping up house prices at the expense of productive
activity.

Furthermore, since the tax on 'notional income' you propose is based
on the value of the asset I can't see any difference at all between
that and an asset tax.   Unless, of course, I would be able to pay my
tax on my 'notional income' with 'notional dollars'.  Does the IRD
accept 'notional dollars'? SNOOPY



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Message posted by Harry Tennyson
 using Pegasus Mail 2.55
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