Mortgaged, a $200,000 home really costs you $400,000. So who says you make a capital gain?
"CAPITAL gain" on the family home is a myth unless you live in Auckland or Wellington with the politicians. When you pay a mortgage, you pay borrowing costs set by the Reserve Bank of NZ and the major banks.
The money you pay has had tax deducted from your wages. We are also paying interest to investors. The Government takes about one-third of that interest in "tax at source".
Over the term of your mortgage loan, you will pay tens or hundreds of thousands in interest. This does not increase the value of your property. So a $200,000 house really costs you $400,000, does it not? So who says you make a capital gain?
You also pay property rates to the Government agency called District Council of on average $3000. No tax write-offs there, either. Duh!
KEN CRAFAR
Durie Hill
Carbon No 1 reason to cycle
An article in the Whanganui Chronicle, February 22 took my attention.
Page 5 shows the 10 reasons to go on your bike. I applaud the fantastic indefatigable incentives from Lyneke Onderwater to get on a bike, but would like to change the sequence of the numbers 1 to 10.
Number 10, "reducing the carbon footprint", move to the top of the list as number 1, because it is important for every soul. All (most) other numbers are just beneficial to the individual.
I'm looking forward for the Chronicle to focus on the subject of carbon affecting life on the planet. It is a serious subject, more important than we might think. So I too say, get on your bike!
ROMBOUT VAN RIEMSDIJK
Whanganui
Vanishing act
I dismiss Labour and Green MPs' claims that they won the election with a mandate for radical change; and who voted for Helen Clark or Sir Michael Cullen to help "run the economy"?
Financial wizard Sir Michael Cullen can make billions vanish in a puff of smoke. The last Labour Government made a strong economy and tax surpluses vanish within six years.
When he was chairman of NZ Post, a Kiwi stamp increased in price from 40 cents to $1·30. NZ Post and Kiwi Bank lost millions.
Increasing prices and taxes will often decrease revenue.
Taxpayers face revenue tax (GST) 15 per cent, income tax 33 (or 39) per cent, capital gains tax 33 (or 39) per cent, carbon tax, rubbish tax, water tax, and more. Our strong economy and tax surpluses will vanish.
Existing death duties, gift tax and stamp duty are set at 0 per cent. Any future Government can simply increase them to overcome loopholes in Capital Gains Tax.
New taxes are never "fiscally neutral". When 10 per cent GST was introduced, the top income tax rate was supposed to be 20 per cent.
ALAN DAVIDSON
Gonville
Rogernomics was our Brexit
Frank Greenall says Churchill was pro-Europe, as in a European union, and he was. But what it is today is not what was envisaged by most pro-union of that time, I'll bet.
Churchill, I am sure, would have been against giving up his sovereignty to the bureaucratic monstrosity that exists in Brussels. My guess: He would fight against it with all his might. It is not just Britain that has become unhappy with the bureaucratic takeover of its sovereign powers, with increasing rumbles coming from the originals, to the extent that the power brokers of Brussels are starting to fear their end is nigh, which is one reason they are trying very hard to make an orderly Brexit impossible.
There is no way you can have a soft Brexit under their rules and not have eternal strife.
NZ had its own Brexit; we called it Rogernomics. I railed against the damage being done to the farming community and the rest of the economy.
I was paying 20 per cent on mortgage and 32 per cent on overdraft, like many others. It led to suicides.
Rogernomics essentially broke the country. In hindsight, it was a relatively short time frame. We came out the other side a reformed fast-growing, stronger country.
If it had been slower it would have turned into a morass with back-sliding everywhere, but it was done and dusted and allowed us to put it to the back of the mind and get on with the bright new side, which would have been much better if David Lange had not listened to the back-sliders and stopped for a cup of tea instead of instituting the 20 per cent flat tax, which would have been the icing on the cake.
A no-deal Brexit will be tough but short and not allow time for the back-sliding that will just turn it into a dog's breakfast.
G R SCOWN
Whanganui
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