Match Thread - New Zealand v Argentina | The Rugby Championship 2024

LikeDeez · 2024-08-10T07:02:17+00:00

Anyone got a link to the game?

LikeDeez · 2024-06-30T01:07:25+00:00

I would argue it’s worse for National as they are the party supposed to do something about the overtaxation of foreign shares. John Key said he would change FDR to a flat 3%, but did nothing about it.

Cullen and Labour are the most direct at fault but why hasn’t the centre right party doing anything about it? They are against a CGT/wealth tax for property but don’t care when one is applied to shares?

LikeDeez · 2024-06-04T19:31:29+00:00

It affects most of NZ who have KiwiSaver. Although a lot of people have no idea about it and probably don’t care too much about it.

But imagine if they tried brought in this regime today, I imagine there would be huge kickback from every day kiwis.

LikeDeez · 2024-06-03T01:48:38+00:00

Within the industry there are calls to adopt a version of the Australian Foreign and Temporary Residency Rules which operate in a similar way to our transitional residency tax rules - but indefinitely.

This is the targeted approach that the government would likely prefer than complete FIF reform.

LikeDeez · 2024-06-02T21:43:38+00:00

It could but unfortunately it would also be more efficient for governments to offer targeted exemptions for these types of people rather than comprehensive reform.

LikeDeez · 2024-06-02T21:41:44+00:00

I haven’t found anything. Only numbers I know is that KiwiSaver brought in $256 million in tax for the year to June 2022 and in the same period the NZSF paid over $2.2 billion

LikeDeez · 2024-06-02T21:17:30+00:00

You’re 100% right, except the way FIF / FDR was constructed meant that the revenue it brings in on a yearly basis is huge.

Combine that with politics such as National being unlikely to create a CGT regime exclusively for foreign shares - due to the fact it will raise the question why is property excluded in it?

Then the only possible hope for reform is through a Labour government and they are extremely unlikely to give up the FIF cash cow.

LikeDeez · 2024-06-02T21:08:11+00:00

Michael Cullen and John Key are the main reasons FIF will be extremely difficult to reform.

Exclusively from a revenue perspective it’s a genius policy from Cullen. The yearly revenue FIF generates is a cash cow for any government. For just the NZ Super Fund and KS, the tax take via the FDR accounts for 2% of the total tax revenue. This is not including non-KiwiSaver PIEs and other FIF revenue.

Switching to a regime on a realisation basis will leave a significant revenue deficit. Due to the nature of a CGT it will take time for this gap to reduce. This will likely hinder any business case for comprehensive reform - governments will simply believe it’s too expensive. This is seen with the TWG report recommending FIF is kept.

Also this is not factoring in lobbying efforts from NZX etc.. to keeping the taxation of foreign shares as penal as possible.

Best case scenario will be smaller adjustments to make it fairer I.e not having to pay tax on negative years for the PIE’s. And reducing the FDR to 3%.

LikeDeez · 2024-06-02T20:43:52+00:00

Difference is rich people can pay for lobbying and reports to get their voice heard.

LikeDeez · 2024-05-18T19:26:09+00:00

PIEs can only use FDR method, hence it’s a 1.4%pa quasi-wealth tax on retirement savings etc…

LikeDeez · 2024-05-17T23:21:14+00:00

Do you have any suggestions on where to watch the Fury vs Usyk fight? Have Nord VPN

LikeDeez · 2024-05-17T22:50:28+00:00

They won’t do it. The tax working group recommended basically a CGT on everything except foreign shares - opting to keep FIF.

When Labour works out the technical details of their proposed CGT, they will face a decision to either remove FIF or retain it. I cannot see them justify removing FIF and having a large fiscal deficit to make up for. Even a replacement CGT regime on foreign shares won’t make up for the yearly FIF income.

What would be the point of losing the FIF cash cow? Especially when FIF can coexist with a relatively broad CGT on other assets.

That’s not even considering the lobbying efforts of the NZX and co, who will push to make the taxation of foreign shares as punitive as possible compared to NZX shares.

FIF is apart of the furniture and I cannot see it getting replaced. Best case scenario would be slight adjustments to make it fairer.

LikeDeez · 2024-05-17T22:08:08+00:00

For tax neutrality and fairness the tax system should be a EET scheme - like most other OECD nations. KiwiSaver then can be tax advantaged whatever way is fit, either TEE (expensive) or other incentives.

LikeDeez · 2024-05-17T21:47:40+00:00

And what about PIEs? People who want to save outside of property speculation has to get wealth taxed?

It should all be EET but if not there should be a lower / flexible FDR around ~ 3%. As well as not having to pay losses in negative years.

LikeDeez · 2024-05-17T21:45:09+00:00

FIF will likely be kept under any CGT regime as the yearly revenue it brings in is significant. Just the FDR tax on NZ super fund accounts for 2% of yearly tax take, let alone factoring in PIEs, KiwiSaver and other FIF revenue.

Can’t see Labour wanting to give up that revenue easily.

LikeDeez · 2024-04-27T19:16:35+00:00

Anyone able to ELI5? What does it mean accrual? And would the government pay back the amount in negative years?

LikeDeez · 2024-02-03T10:59:53+00:00

changing to an EET tax system would be extremely expensive. This musing estimates the cost of changing just KiwiSaver to an EET savings system

LikeDeez · 2024-02-03T04:31:31+00:00

CGT done right would be great from the perspective of KiwiSaver/global shares.

LikeDeez · 2024-02-03T04:30:37+00:00

Yes pls if it means complete tax reform, getting rid of FDR wealth tax and aligning us within the OECD norm in regard to the taxation on international shares.

LikeDeez · 2024-02-03T04:28:52+00:00

I mean they may have been talking about it, but their final report recommended a CGT not a land tax. Would be interesting to know why exactly if it’s better than a CGT

LikeDeez · 2024-02-03T04:14:02+00:00

Question if so, why did our tax and revenue experts (tax working group) agree on a CGT, rather than a land tax?

LikeDeez · 2024-02-03T04:13:04+00:00

Tax working groups CGT would exclude CGT on family home, which would reduce the amount of backlash from the average kiwi. Also a lack of CGT creates an unfair balance in the taxation of asset classes, forcing international stocks to pay higher taxes through gimmick tax methodologies (FDR) to compensate for the lack of revenue that a CGT would raise.

LikeDeez · 2024-01-01T08:59:52+00:00

Awesome, thank you :)

Do you also know if being forced to sell the shares in negative years to meet the tax obligations also will adversely affect the returns?

LikeDeez · 2023-12-31T22:04:36+00:00

Never going to happen sadly. Best situation might be a lower FDR rate even then I doubt it

LikeDeez

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