New Helen Clark Foundation Report Urges Capital Gains Tax
by RNZA new report into New Zealand's shortage of affordable housing has called for a capital gains tax.
The study by the Helen Clark Foundation said a decades-long boom in property investment had driven up housing and land prices at the expense of families and people's basic need for shelter.
Dr Jenny McArthur wrote the report and told RNZ's Morning Report a capital gains tax must be back on the agenda to tackle the affordability crisis, as well as debt-to-income limits.
"I understand it's politically challenging, but I think it's so important that we confront the issue that if prices are not brought down the impact on our society - which is already profound and hugely damaging - will only get worse," she said.
McArthur said policies should target untaxed profits from speculative housing investment, as well as offering affordable housing to low-income households.
However, the Property Investors' Federation said the push for a capital gains tax was "misguided."
Executive officer Andrew King said the proposal would not improve the situation and should not be supported.
"Today's proposal would be particularly hard on those who have purchased their first home over the last few years," he said.
"If house prices fall these young people could easily see their equity disappear and banks call in their loans."