The Road Transport Forum is welcoming the Government’s decision to scrap the capital gains tax.
Prime minister Jacinda Ardern says the Government was “unable to build a mandate” around the policy and would not be proceeding with it.
“The Tax Working Group gave the Government, and the country, an opportunity to look at the fairness of our tax system and debate options for change.
“All parties in the Government entered into this debate with different perspectives and, after significant discussion, we have ultimately been unable to find a consensus. As a result, we will not be introducing a capital gains tax,” Ardern says.
“While I have believed in a CGT, it’s clear many New Zealanders do not. That is why I am also ruling out a capital gains tax under my leadership in the future.
“The Tax Working Group was a valuable exercise that has delivered some useful suggestions well beyond just the debate on CGT, and I want to thank the Group for its work. In fact the majority of recommendations will either be investigated further or have formed part of our work programme,” Ardern says.
Road Transport Forum chief executive Nick Leggett says it “had the potential to severely impact NZ businesses”.
“Transport operators across New Zealand will be relieved the Government has decided against a Capital Gains Tax.
“A new capital gains tax would have added to the already significant tax burden on transport business and would reduce the investment that business owners could make back into their businesses.
“There would be less money to hire more staff, invest in professional development and training, purchase more modern equipment and generally make businesses more productive,” Leggett says.
“For transport companies a CGT would have covered vehicles, premises, land, equipment and other business assets. The compliance alone would have been extremely onerous.
“With Labour and the Greens being strongly in favour of a CGT it was left to NZ First to argue against it around the Cabinet table and we are glad that they succeeded.
“We now hope that the Government can refocus on increasing productivity and growing the economy for the benefit of all New Zealand businesses,” Leggett says.
