October 27, 2025 • 5 mins
One of the country’s leading economists discusses Labour’s new capital gains tax policy, the OCR and our exchange rate.
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
He has one of the sharpest minds economic minds in
the country. Cameron Bagri independent economists. What did you make
of as I'm describing at Cameron, the Clayton's CGT, the
capital gains tax when you're not really having one.
Speaker 2 (00:15):
Well, yeah, glass are full. The turn the dial slightly
towards broadening the tax base, and it's in the form
of a capital gains tax, not a wealth tax. I
think that it's a positive side. But it gives you your
glass up into here. But they haven't turned the dial
too much. And this disease, you call it the Clayton's tax,
it's not going to bring in too much money. I
(00:35):
think the estimates I've seen is it might bring in
two point four to two point five bnion over a
ten year period. So it's going to help to broaden
the tax base. But I guess what's notable is it? Yeah,
what's out as opposed to what's in.
Speaker 1 (00:47):
Absolutely everything's out. There's hardly anything in. This is just
having a crack at people who are investing in residential
property or commercial property. But the different and batches. Yeah,
of course quite rightly, the family home is exempt, but
the farmers would have to be pleased with this one.
It's not applying to farms, it's not applying to keywi
(01:09):
saver shares, business assets inheritance, even your personal items like cars, boat's,
art and furniture. So I just reckon it's an exercise
in flying a kite or dipping your toe into broadening
the tax base. That's kind of it. Electorally, it's palatable,
but it's a nonsense. It's a nonsense that people like
(01:31):
you and me are going to get three free doctors
visits a year out of this.
Speaker 2 (01:36):
Well, I think that's the real nuts side of this.
In regard to lock you. They've raising a little bit
of money where they're going to get spend that money.
Are they going to spend that money towards healthcare which
is edible? Well, but everybody's going to get the benefit. Yeah,
I'm not a believer in that sort of stuff, Jamie.
There's no reason people like you, people like me should
(01:57):
get more subsidized healthcare. If you go to money off
people in the form of a capital against tax, let's
make sure that we read point that money into those
areas of the economy or those areas of society that
really need it.
Speaker 1 (02:08):
Hey, let's talk about the official cash rate. We've got
another review coming up, I think late November. We're sitting
at two and a half and looked odds on until
those inflation numbers came out that we would get down
to maybe two percent. But now the markets or the
jury's out, isn't it. Is it going to be two
point twenty five the end spot or is it going
(02:29):
to be two because inflation is still running at three?
Speaker 2 (02:33):
Yeah, headline inflation is so dark. If you strip out
the likes of administrative charges, which is local authorities, central
government sort of charges, inflation's a lot more contained. Ye.
The core inflation measures look like they're running around two
and a half. So the markets that are hedging its
bets and the OCI might go to two, might go
to two point two five. So we're at two point
(02:54):
five at the moment, So we're within spitting distance of
where the market thinks the croft is going to be.
We're getting towards what's called the glide path or monetary
policy near the endpoint, and the Reserve Bank just needs
to be a little bit careful here because this economy,
I still think has got a lot of latent underlying inflation.
With pressure out there, and it looks like there's a
(03:17):
big bow wave of inflation or cost increases that people
want to pass on into price increases as soon as
we start to see things back up. So what's the
space The reserve banks obviously decided to go big with
the fifty that they need to go fifty in mine
might know I've done it, will take it. Maybe we
get one more, and we get one more. I think
(03:38):
it might be one and Dow.
Speaker 1 (03:40):
Is there exchange rate getting too soft?
Speaker 2 (03:43):
Or is it?
Speaker 1 (03:44):
And if it is, is there anything we can do
about it? The answer is probably no to the second question,
But I.
Speaker 2 (03:50):
Guess we're obviously definition are too soft because the currency
is just a relative price variable. Yeah, Jamie. That shifts
the playing field from exporters to inputs. You know, when
the currency is low, exporters win, importers lose. When the
current is high, exporters lose and importers win. If you
look at fair venue for the New Zealand dollar against
(04:12):
the Green Bay, I think it's around sixty five cents.
We're around fifty seven to fifty eight, So we're in
that export friendly zone and we need that export friendly
sort of number at the moment because we had a
horrific current account and deficit. We had a completely unbalanced economies.
That lower currency in combination of higher currency with high
commoti prices is engineering. What we cause a quality upturn
(04:34):
as opposed the one led by inferior quality in the
form of an a runaway Aukland property market. So it's
not great if you want a holiday overseas, but we
need that currency at the moment and an export friendly zone.
And it's been interesting to see if late just we're
starting the nudge down against the Australian dollar as well.
We've spent an awful lot of time up there around
(04:55):
ninety five cents and now we're that down below ninety.
That's still probably a lot of it on the expensive
side to me, but it's starting to move towards being
a more export friendly number if you're putting products into
the Australian market.
Speaker 1 (05:09):
Yes, no question. To finish on going back to where
we started. Does New Zealand need to broaden the tax
space with the capital gains tax?
Speaker 2 (05:19):
Yes, i'd right far rather it came through the capital
gains tax regime as opposed to some of the nutty
stuff in the former wealth taxes.
Speaker 1 (05:28):
Cameron Vagrie, thanks as always for your time on the country.
Appreciate it all.
Speaker 2 (05:32):
The rest gener
He has one of the sharpest minds economic minds in
the country. Cameron Bagri independent economists. What did you make
of as I'm describing at Cameron, the Clayton's CGT, the
capital gains tax when you're not really having one.
Speaker 2 (00:15):
Well, yeah, glass are full. The turn the dial slightly
towards broadening the tax base, and it's in the form
of a capital gains tax, not a wealth tax. I
think that it's a positive side. But it gives you your
glass up into here. But they haven't turned the dial
too much. And this disease, you call it the Clayton's tax,
it's not going to bring in too much money. I
(00:35):
think the estimates I've seen is it might bring in
two point four to two point five bnion over a
ten year period. So it's going to help to broaden
the tax base. But I guess what's notable is it? Yeah,
what's out as opposed to what's in.
Speaker 1 (00:47):
Absolutely everything's out. There's hardly anything in. This is just
having a crack at people who are investing in residential
property or commercial property. But the different and batches. Yeah,
of course quite rightly, the family home is exempt, but
the farmers would have to be pleased with this one.
It's not applying to farms, it's not applying to keywi
(01:09):
saver shares, business assets inheritance, even your personal items like cars, boat's,
art and furniture. So I just reckon it's an exercise
in flying a kite or dipping your toe into broadening
the tax base. That's kind of it. Electorally, it's palatable,
but it's a nonsense. It's a nonsense that people like
(01:31):
you and me are going to get three free doctors
visits a year out of this.
Speaker 2 (01:36):
Well, I think that's the real nuts side of this.
In regard to lock you. They've raising a little bit
of money where they're going to get spend that money.
Are they going to spend that money towards healthcare which
is edible? Well, but everybody's going to get the benefit. Yeah,
I'm not a believer in that sort of stuff, Jamie.
There's no reason people like you, people like me should
(01:57):
get more subsidized healthcare. If you go to money off
people in the form of a capital against tax, let's
make sure that we read point that money into those
areas of the economy or those areas of society that
really need it.
Speaker 1 (02:08):
Hey, let's talk about the official cash rate. We've got
another review coming up, I think late November. We're sitting
at two and a half and looked odds on until
those inflation numbers came out that we would get down
to maybe two percent. But now the markets or the
jury's out, isn't it. Is it going to be two
point twenty five the end spot or is it going
(02:29):
to be two because inflation is still running at three?
Speaker 2 (02:33):
Yeah, headline inflation is so dark. If you strip out
the likes of administrative charges, which is local authorities, central
government sort of charges, inflation's a lot more contained. Ye.
The core inflation measures look like they're running around two
and a half. So the markets that are hedging its
bets and the OCI might go to two, might go
to two point two five. So we're at two point
(02:54):
five at the moment, So we're within spitting distance of
where the market thinks the croft is going to be.
We're getting towards what's called the glide path or monetary
policy near the endpoint, and the Reserve Bank just needs
to be a little bit careful here because this economy,
I still think has got a lot of latent underlying inflation.
With pressure out there, and it looks like there's a
(03:17):
big bow wave of inflation or cost increases that people
want to pass on into price increases as soon as
we start to see things back up. So what's the
space The reserve banks obviously decided to go big with
the fifty that they need to go fifty in mine
might know I've done it, will take it. Maybe we
get one more, and we get one more. I think
(03:38):
it might be one and Dow.
Speaker 1 (03:40):
Is there exchange rate getting too soft?
Speaker 2 (03:43):
Or is it?
Speaker 1 (03:44):
And if it is, is there anything we can do
about it? The answer is probably no to the second question,
But I.
Speaker 2 (03:50):
Guess we're obviously definition are too soft because the currency
is just a relative price variable. Yeah, Jamie. That shifts
the playing field from exporters to inputs. You know, when
the currency is low, exporters win, importers lose. When the
current is high, exporters lose and importers win. If you
look at fair venue for the New Zealand dollar against
(04:12):
the Green Bay, I think it's around sixty five cents.
We're around fifty seven to fifty eight, So we're in
that export friendly zone and we need that export friendly
sort of number at the moment because we had a
horrific current account and deficit. We had a completely unbalanced economies.
That lower currency in combination of higher currency with high
commoti prices is engineering. What we cause a quality upturn
(04:34):
as opposed the one led by inferior quality in the
form of an a runaway Aukland property market. So it's
not great if you want a holiday overseas, but we
need that currency at the moment and an export friendly zone.
And it's been interesting to see if late just we're
starting the nudge down against the Australian dollar as well.
We've spent an awful lot of time up there around
(04:55):
ninety five cents and now we're that down below ninety.
That's still probably a lot of it on the expensive
side to me, but it's starting to move towards being
a more export friendly number if you're putting products into
the Australian market.
Speaker 1 (05:09):
Yes, no question. To finish on going back to where
we started. Does New Zealand need to broaden the tax
space with the capital gains tax?
Speaker 2 (05:19):
Yes, i'd right far rather it came through the capital
gains tax regime as opposed to some of the nutty
stuff in the former wealth taxes.
Speaker 1 (05:28):
Cameron Vagrie, thanks as always for your time on the country.
Appreciate it all.
Speaker 2 (05:32):
The rest gener
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.
The Breakfast Club
The World's Most Dangerous Morning Show, The Breakfast Club, With DJ Envy, Jess Hilarious, And Charlamagne Tha God!