NEW REPORT: A wealth tax taxes savings, innovation and entrepreneurial growth
A new report published by the New Zealand Taxpayers’ Union analysing the impacts of a wealth tax reveals that it would be significantly damaging for New Zealand economically and would discourage savings, innovation and entrepreneurial growth.
Using a collection of the world’s leading research in the area of wealth taxes, the report assesses the impact a wealth tax would have on New Zealand using the Green Party’s proposed wealth tax policy as a framework for the analysis.Key findings of the report are that the Green's tax proposals would:
> Tax many ordinary families and capture substantially more people than the 0.7% of New Zealanders claimed by the Green Party.
> Set up a Green tax haven whereby moderately wealthy New Zealanders who are reasonably debt free will put their assets into a trust to avoid the 2.5% wealth tax.
> Create a substantial barrier to growth for small and medium sized businesses.
> Make it harder to start a business by taxing family homes that are kept in a trust for asset protection.
> Impose a substantial tax on farms amounting to a $45,000 tax for the average dairy farm or a $120,000 tax if it is owned by a family trust.
> Reduce the ability for founders of public companies to continue to control and reinvest in those companies.
> Tax the innovation and investment that underwrites wage growth and lead to lower wages.
> Make it less attractive for entrepreneurs to pioneer new technologies in New Zealand.
> Make New Zealand a less attractive location to move for skilled and entrepreneurial individuals living overseas.
Taxpayers’ Union Research Fellow and author of the report, Jim Rose, said:
“It's clear that the Green Party’s proposed tax policies would be economically devastating for New Zealand and would see many of our best and brightest entrepreneurs and innovators discouraged from making our country a better, more prosperous nation.
“Not only will much greater proportion of the population than claimed by the Greens be captured by their proposed wealth tax but it will also tax, and therefore discourage, the innovation, skilled immigration and entrepreneurial flair that grows the economy and makes us all wealthier. In other words, it is not just the rich who suffer from a wealth tax.”