Chris Hipkins speaks to the media after addressing the Council of Trade Unions at their biennial conference.
Green Party co-leader Chlöe Swarbrick says Labour’s capital gains tax would be a “starting point” in any future coalition negotiations, despite Labour’s assurances that implementing the policy in its current form is a bottom line.
Labour leader Chris Hipkins yesterday announced his party would introduce a 28% tax on profitsmade after the sale of commercial or residential property, excluding the family home.
Hipkins will address media again this afternoon at the Council of Trade Unions Biennial Conference in Wellington. It will be livestreamed at 1.45pm at the top of this article.
Labour’s policy, which would come into force from July 1, 2027, would also not apply to farms, KiwiSaver, shares, business assets, inheritances and personal items such as cars, boats, art and furniture.
The tax was projected to attract about $700 million on average per year, which would be ringfenced for health spending, specifically on funding three free GP visits for every New Zealander.
In a statement yesterday, Swarbrick described the policy as “watered-down”.
“Right now, the wealthiest pay half the effective tax rate of our nurses, teachers and firefighters. Labour’s announcement doesn’t even try to fix that.
“In a year, the richest family in this country can make more money in their sleep, without lifting a finger, than Labour’s proposed CGT would generate.”
Greens co-leader Chlöe Swarbrick supports a wealth tax, as does Te Pāti Māori. Photo / Mark Mitchell
In its alternative budget announced in May, the Green Party proposed implementing a 2.5% wealth tax on net assets, such as property and shares, over an individual threshold of $2m (or $4m for couples).
The party expected to raise $72.4 billion over four years, which the party said would be put towards free healthcare, dental care, early childhood education and environmental protection.
Te Pāti Māori also supports a wealth tax. Current polling suggests Labour would need both the Green Party and Te Pāti Māori to form a Government.
Labour has consistently stated it would have ownership over fiscal policy and hold the finance portfolio if it were the largest party in any future governing arrangement.
Labour MP Ginny Andersen, speaking this morning on Newstalk ZB, confirmed there would be no changes to the party’s tax policy during any coalition negotiations, saying it was a bottom line.
“We’ve been very clear on that, Barbara Edmonds will be the Minister of Finance, and it is this model that we will be implementing.”
Speaking to reporters at Parliament, Swarbrick warned there was a “long time to go before the election”.
“I know that a lot of politicians are trying to say that certain things are off the table or not.
“I think that if New Zealanders want functional public services in this country, they want to fix our hospitals and our schools and our crumbling infrastructure, then we need to face the music, we need to face the reality that that’s going to take serious investment.”
Asked whether her party would ever accept Labour’s tax policy in its current form, Swarbrick described it as a “starting point”.
“A bottom line tends to mean that that’s the starting point, and we’d like to go a lot further.”
Adam Pearse is the deputy political editor and part of the NZ Herald’s press gallery team based at Parliament in Wellington. He has worked for NZME since 2018, reporting for the Northern Advocate in Whangārei and the Herald in Auckland.
