The Labour Party is showing signs of gambler's courage - the reckless bravery of those who have nothing left to lose - and raised the long-dreaded sceptre of a capital gains tax.

The facts got lost in the furore, so it's worth recapping. It is believed the proposal is a modest 15 per cent - the same rate as GST - on the sale of property other than the first home. The tax is on the amount by which the property has increased in value since it was last sold, not the sale price.

Predictably everyone whose wealth is the result of capital gains is against the proposal. Those who don't own a second home, the mythical "time-honoured way of ordinary folk to fund retirement" according to the Real Estate Institute's Helen O'Sullivan, weren't fussed.

The Prime Minister, Reserve Bank economists and Labour strategists can - and probably will - argue until November about how much the tax would raise but the dollar amount is not important. The core issue is equity.

A capital gain is no more than unearned income which incurs no tax. The unfairness of this is obvious.

Andrew King, president of the Property Investors Federation, said a capital gains tax would be unfair because it would treat property investors differently from other investors. He is right and his complaint is easily dealt with. The tax should apply to all capital gains, whether from the sale of property, stamps, shares or juice companies.

And to be truly fair, the tax would also apply to the sale of a first home, which would have the extra benefits of reining in our unrealistic property market and encouraging investment in other areas.


The anti-MMP Vote for Change campaigners have finished the week minus one white supremacist - Alex Fogerty - whose vicious rantings caught him out - and one good-intentioned liberal -Bob Harvey - who gave the impression of having woken up to find he'd fallen asleep in someone else's house and got out of there asap.

The campaign will continue because dissatisfaction with MMP is not really about the system itself. It is an expression of people's dissatisfaction with life in general and politics in particular.

So, despite their best efforts to make fools of themselves, the remnants of Vote for Change will still find people prepared to listen to them.

We can expect the anti-MMP campaign to focus on the superficially plausible argument that list seats are odious because they let people who would not win an electorate seat into Parliament. This is precisely the strength of MMP and the best reason not to change it. All electoral systems have the potential to let incompetent time servers into Parliament.

In most, a candidate needs to do no more to get elected than win selection for the right party and not appear drunk in public before polling day.

Those running our parties are - generally - skilled managers, able to spot talent and foster it. MMP lets them shoulder tap potentially brilliant candidates who, for one reason or another, would not win an electorate.

Whatever you may think of aspects of what they say or do there is no denying the ability of such list MPs as National's Hekia Parata, the Green's Catherine Delahunty and Labour's David Parker.

MMP has been mocked as a "one man two votes" system. In fact, it is the best of both worlds.

Maori Language Week
Q: With which commonly used phrase did radio host Mike Hosking begin an interview with Te Karere presenter Scotty Morrison on the topic of Maori Language Week?

A: "Good morning."