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John Key - Source: ONE News -
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Labour is promising a new policy which it says will change the course of the country.
ONE News reported last night that the policy will include a capital gains tax and while Phil Goff is trying to keep the details secret for another week, National is on the attack.
At a business breakfast this morning, Prime Minister John Key was keen to get stuck in to Labour's policy.
"I find myself in an unusual position of announcing their policies before they have," National's party leader said.
Labour is expected to announce a 15% capital gains tax, excluding the family home, next week but while their leader won't deny the policy, he won't discuss it either.
"We're making the announcement in full next Thursday," said Goff.
Until then National is filling the vacuum, telling people that a capital gains tax won't pay for Labour's promises.
"If they don't sell assets as they are arguing they won't, if they do have a $5000 tax free threshold as they are arguing they will, and they do take GST off fruit and vegetables, they are $12 billion in the hole for the first three years," said Key.
Key told the Wellington Employers' Chamber of Commerce meeting that the $4.5 billion figure would mean the tax rate would be about 30%, ONE News political reporter Michael Parkin reported.
While the family home would be excluded, the tax would apply to bach, farm and industrial properties, Key said.
He said yesterday that the only winners from a capital gains tax would be accountants.
National claims a capital gains tax is too complex to administer but the Green Party said they can manage it in many other countries, including the US, the UK and Australia.
Figures explained
ONE News political editor Guyon Espiner said he understood the tax would not be retrospective, so profit that might have been made from buying a property some years before the tax was introduced would not be taxed.
On the basis of a 15% rate, if an investor bought an investment property at about $400,000 and sold it for $500,000, making a profit of $100,000, the investor would pay $15,000 of that to the Government.
Espiner told TV ONE's Breakfast today that the 200,000 or so people with investment properties would "not like" the policy.
However, he said most New Zealanders do not have an investment property and that if Labour "can argue this properly they should be able to carry this argument".
Espiner said he did not see the the tax gaining too many votes but it would allow Labour to gain revenue.
"Let's look at how they spend it and judge them on that," he said. "If this is just to pay for their current policies I'm not sure it's going to expand their base too much.
"If they've got other ideas they can fund through using this money then maybe they can grow their vote base."
Goff is due to reveal Labour's tax policy next Thursday.
