The Tax Working group’s final report - Future of Tax - released last week has certainly provided plenty of food for thought and emails in my inbox.
The main recommendation from the group, which has garnered the most attention thanks to fevered rhetoric from some, has been the recommendation around extending capital income taxation.
However, this is just one of 99 recommendations which were made by the Tax Working Group to make our tax system fairer.
The report found that overall, our tax system is clear and simple, but there is room for improvement. There are areas of unfairness that should be addressed. The TWG recommended extending capital income taxation, and all members of the group agreed that residential rental property should be included.
A majority of the group were in favour of a broad extension that would apply to most other asset classes, including land and buildings (except the family home), business assets, shares and intangible property.
The TWG also recommended a range of additional measures aimed at improving the structure, fairness and balance of the tax system, in areas including business, the environment, personal income and savings and Maori perspectives.
The government will now seek technical advice on addressing the unfair and unbalanced elements identified by the TWG and make further announcements in April on any measures to enhance the fairness and integrity of the tax system.
If you’re interested in reading about the other 98 recommendations to improve the system, the full report can be found at: www.taxworkinggroup.govt.nz/resources/future-tax-final-report