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Ryan Bridge: Hey Labour, NZ is not Australia · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: Hey, labor New Zealand is not Australia. A little message
• 0:03
  Speaker 1: for you this morning. Last week on my Herald show,
• 0:06
  Speaker 1: I ran through some numbers on TOPS calculator and that
• 0:10
  Speaker 1: got ugly for Top. Today we're looking at Labour's capital
• 0:14
  Speaker 1: gains tax. They justify it by looking at Australia. They say,
• 0:19
  Speaker 1: just look across the ditch and the sky hasn't fallen.
• 0:21
  Speaker 1: Here's a quote from them. Australia introduced a capital gains
• 0:24
  Speaker 1: tax in nineteen eighty five and its economy and incomes
• 0:27
  Speaker 1: have kept growing. Okay, like those two things are related.
• 0:31
  Speaker 1: This is true, not untrue, but also amidst two quite
• 0:36
  Speaker 1: important things. One, Australia is not rich because it has
• 0:40
  Speaker 1: a capital gains tax. Australia is rich because it has
• 0:43
  Speaker 1: a larger economy, greater economies of scale, and mainly because,
• 0:47
  Speaker 1: unlike US, they extract minerals and fossil fuels from the
• 0:51
  Speaker 1: earth for the rest of the world to burn and
• 0:53
  Speaker 1: all make steel. Their top export earners are iron or
• 0:58
  Speaker 1: oil and gas coal LNG and then finally farming. Guess
• 1:03
  Speaker 1: we are those young people who are leaving New Zealand
• 1:06
  Speaker 1: and leaving Motel City in Rottadua looking for a job
• 1:10
  Speaker 1: where they're probably going a mining job in Australia. Labour
• 1:14
  Speaker 1: wouldn't let them have. Here. Number two, this is how
• 1:17
  Speaker 1: the tax is applied. It's not fair because labor New
• 1:20
  Speaker 1: Zealand's tax is treated very differently to the Aussies. Let's
• 1:23
  Speaker 1: say you buy a house a rental today for a
• 1:25
  Speaker 1: million bucks. You can sell it for one and a
• 1:27
  Speaker 1: half and ten years you've made five hundred k. Right. Wrong.
• 1:30
  Speaker 1: Once you take into account how much inflation has eroded
• 1:33
  Speaker 1: away the value of that money in real terms, you
• 1:36
  Speaker 1: are worse off. So you are getting taxed on the
• 1:39
  Speaker 1: full twenty eight percent, on the full five hundred k,
• 1:42
  Speaker 1: when it should be the three hundred k or whatever
• 1:45
  Speaker 1: the inflation adjustment is. And here again the Aussies do
• 1:49
  Speaker 1: it better. They are not as harsh. They give you
• 1:52
  Speaker 1: a fifty percent discount to account for inflation. No such
• 1:57
  Speaker 1: offer from Hipkins, no such offer from labor and probably
• 2:02
  Speaker 1: and what is this going to bring house prices down? Well? No,
• 2:05
  Speaker 1: because remember they need it to go up in order
• 2:07
  Speaker 1: to pay for the doctor's visits. So does the math
• 2:10
  Speaker 1: really add up? Here for more from early edition with
• 2:14
  Speaker 1: Ryan Bridge listen live to news talks it'd be from
• 2:17
  Speaker 1: five am weekdays, or follow the podcast on iHeartRadio