David Cunliffe: Former Labour Party Leader on a capital gains tax being on the agenda at the Labour Party conference

A capital gains tax is a no-brainer, according to a former Labour Party leader. 

The topic is understood to be on the agenda at the party's conference in Christchurch this weekend, with members deciding whether to continue work on the proposal. 

David Cunliffe told Mike Hosking he believes most in the party would be keen on the tax. 

When it comes to voters, he says that capital gains taxes have actually polled really well in the last couple of elections, and one could say that its polled better than the Labour Party. 

Cunliffe says that it’s unlikely to be a net vote loser. 

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Episode Transcript

Speaker 1 (00:00):
Labour Party have their annual party conference this weekend. There
will be a vote apparently on the capital gains tax.
The vote will decide whether to move forward with the
idea and if so how Our former leader and Finance
spokesperson David Cunliff is with us on this David, morning
to you, good morning. Make the history of it and
the various attempts within the Labor Party over the years
to get it enacted. How will that play do you

(00:20):
think this weekend?

Speaker 2 (00:23):
As you say, it's an idea that's been around a
long time in New Zealand's or must year he can
develop world and not having a capital gains tax, So
it's premature debate now. It's almost I would have thought
a no brainer. But let's just see at the matt
for the members.

Speaker 1 (00:38):
What do you reckon will happen?

Speaker 2 (00:41):
Look, I don't have any side knowledge on this, but
my sense is that both the finance spokesperson Barbara Edmunds
and the really new spost person Deva will probably favor CGT.
But I think that they'll leave it to the members
to kick the boarder around. There's a lot of reasons

(01:01):
why you do the CGT. It's fair it takes a
little bit of the heat of property speculation that evens
up and centers between asset plusses to help business work
and capital go forward. And you can use it for
it income tax offset. And you know, if you want
a broad based, low rate tax system, you probably want
to cut all sorts of income, whether they're from labor

(01:23):
or from capital. And it's just the smart and fair
thing to do.

Speaker 1 (01:27):
And love you do you offset it with some sort
of compromise elsewhere or do you just sell it the
way you've just sold it.

Speaker 2 (01:35):
I think it's very possible to over time use it
off sets and income tax. So you know, you teach
us doctors your farm and your farmers can take less
growth of or a cup in income tax in exchange
for realized capital gains usually excluding the family home being
brought in at some sort of rate just bordance tax
basement means and give offsets elsewhere.

Speaker 1 (01:56):
What about the politics of it, say you're going and
if the podcasts are right, you've got some real growth
back in the economy. By twenty twenty six, you've got
a national lead government that goes, not only do we
not increase taxes, we're looking to cut them. The economy's rolling.
How do you sell that in an election?

Speaker 2 (02:09):
You Well, firstly, this is new. In the last couple
of elections, cgts have actually poled really well, and one might,
with a right smile on your case, say CGT poll
better than the Labor Party. So it's unlikely there be
a net vote, and most middle grand national voters I

(02:32):
know would also support a CGT. Not so a wealth tax.
I mean a wealth tax has got a retrospective elepment
sometimes because it goes to accumulated wealth and high wealth
individuals might vote with their feet. So I think that's
a much risky proposition. I think Labour should be moderate
here and just do a sensible, relatively low rate, broad

(02:52):
based CGT.

Speaker 1 (02:54):
Good insight. Appreciate it. David Candler, former Labour Party leader,
of course.

Speaker 2 (02:57):
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