The failure of government to implement a capital gains tax is an opportunity lost to address the gross inequities that exist across NZ society. We are a nation of have-nots and have-lots with a segment of the population often described as middle income, tramped in the middle by their middling incomes.
The dropping of the CGT is another example of how inequity plays out in decision making. Those with the most campaigned furiously against it. These with the least who would benefit most from the boost of CGT to government funding to address inequities were never heard.
Those with an interest in seeing it ditched were those with money and influence. That group have more access to the means to voice their opinions and safeguard their wealth and of course the majority of this group have no interest in being taxed on their houses or the sale of their businesses. It also seems they have no interest in contributing to the greater social good that comes from taxing those on high incomes to fund justice, education, health, social housing and welfare programmes.
If the CGT had been touted as a way that all contribute to society it would have made it clear that the those lobbying against were basically greedy and unwilling to share their good fortune with the wider community. Instead it was the whining wealthy who won the day because they had access to the media and networks that can voice their dissatisfaction with CGT. In this way the very inequity the tax was proposed to address was undermined.
If you are a struggling household in a poor neighbourhood you will not have the means or energy to devote to arguing for a specific tax on capital gains and you are not likely to ever pay it because you will not have a million-dollar house, business and holiday home.
If society was a see-saw then the wealthy would never shift their position and allow those on low incomes to rise even a little from the daily struggle to make ends meet.
There has been much conjecture that it was Winston (not elected to Parliament but does look after his own interests) Peters who vetoed the policy. If that was indeed the case then he should be ashamed of himself. He has houses, boat, lucrative MP's pension plan and we pay his salary. He is not a struggling family in Northland trying to pay the bills. Perhaps he does not understand how the dynamic of inequity functions?
In basic terms those with wealth, connections and the ability to mobilise resources to advance their interests will always win out against those who are too busy surviving day to day to gather the time and resources needed to protest and lobby.
The same dynamic can be seen at a local and regional level when councils make decisions. Those in low income neighbourhoods struggle to have their voices heard while the wealthy suburbs use their connections to influence decisions because they can. Liquor store in a low-income area – yes. Liquor store in a wealthy suburb – no way.
It once again raises the elephant in the debating chamber – the majority of MPs are well-off. Are they at times looking after their own interests while in Parliament? Does their relative wealth and taxpayer funded perks mean they have lost sight of how life really is for many of their constituents?
Terry Sarten (aka Tel) is a writer, musician and social worker.