The country does not need a Capital Gains Tax to fix the economy.

A new report from PWC argues tax reform is needed to help rebuild the economy post Covid-19.

The report says the elephant in the room is a capital gains tax, but successive governments have declined to introduce it.

Chief economist at the NZ Initiative Eric Crampton told Heather du Plessis-Allan says that there are already brightline rules around buying and selling houses that do bring in types of capital gains. 

"We've had 30 years of taxes and evolution around not having a capital gains tax, and that's caused a lot of changes in definitions to things so we get things considered income here that are taxed as income that would be considered capital under capital gains tax in under places."

He says that you can't add a capital gains tax on top of a tax system that has evolved around not having one. 

LISTEN ABOVE

 

• Report says Capital Gains Tax would help with economic recovery