No, higher than 4.1 but not as bad as today. Interest rates at 21% were higher than today though.
That is not the point. What I am saying and maybe you missed is that the 4.1 ratio doesn't work, in Auckland anyway and will never work.
Politics 🗳️ NZ Politics
- Thread starter wizard of Tauranga
- Start date
That is not the point. What I am saying and maybe you missed is that the 4.1 ratio doesn't work, in Auckland anyway and will never work.
NZWarriors.com
Median income far too low. House prices far too high. Duh.
How about nz joins the real world and starts taxing capital gains, windfall taxing on huge profits, and actually having other forms of viable investing other than houses. That might be practical AND look after our citizens and provide them with basic needs.
Which is WHAT ANY GOVERNMENT should aspire to.
Instead we have a grifting conspiracy theorist as pm while his right wing extremist stooges from the other parties hover around.
You can invent as many taxes as you can think of. It wont bring building , land or compliance costs down.
Your mates of the last six years tried that and look what happened.
NZWarriors.com
- Thread starter
- #3,204
I agree with the idea. I want that as well.
But can we ever get it with a capitalist system.
Whenever supply of houses get near to demand, prices and rent lower so developers pull out forcing supply to always be not quite enough.
We see it with housing, food, rent, labour, etc.
Anything that is expensive (and limited) seems to naturally increase in price under capitalism.
In theory supply = demand. In reality when risk is added, demand won’t be met by the private sector as it’s to risky (boom bust cycle).
Which means govt must bridge the gap. They cant bridge it through building enough to bridges the gap (although they do need to build) because the private sector will just reduce to compensate and retain a buffer (unless the state provides all). They must do it through pro housing settings.
They didn't try anything cohesive or coherent. And they're equally neoliberal.
Whataboutism eh. It's been shit for 40 years. It's this vicious flavour of neoliberalism that is our capitalism, one that extracts wealth at rapid rates upwards, and relies on mass immigration to keep wages low, while wanking on about small government good, and the private corporates reap billions while socialising their losses, which we ALL have to pay for in the lack of infrastructure etc
What hasn't worked, isn't working is what I've just described. Egalitarian NZ? A fucking myth.
Windfall taxes is a really tricky one and would be incredibly difficult to implement. How do you judge profit in one year vs across the full economic cycle, what would the threshold be for return on capital for a specific company or industry?
I’ll give you a recent example - shipping lines made enormous profits in recent years as global trade was impacted by severe supply chain congestion and high consumer demand for physical products. No question it was a period of windfall profits. However that industry on average makes well below its cost of capital… and that is where it is heading again now. So do you tax the windfall profit or do you instead accept it is all part of an economic cycle and profits will on average across a cycle just reflect a normal operating environment of balanced supply & demand?
NZWarriors.com
Why would banks be low hanging fruit? They make a big profit however they don’t make a large excess return on capital and net interest margins have been trending down for years? What qualifies their profits as ‘windfall’?
I deleted my post because it wasn't actually 8 countries - just some some of the biggest countries in the world.
It's low hanging fruit because the banking sector are making excessive profit inside th and sending it out of NZ.
A definition of windfall tax can mean excessively larger. Not just an unexpected amount.
TBH - It's hard to get my head around anyone arguing against banks paying more tax in NZ
I'll argue against it. Not because I love banks, quite the opposite, or own shares in banks.
Because, company tax must be the same for all companies. How can you say the banking industry should pay more company tax than another sector? Selective tax rates for different sectors would see capital flight and the cost of everything would rise because the cost of capital would rise.
NZWarriors.com
Can't you look at how these sectors profit in other countries (with better competition), like they did with the supermarket study. Pretty sure NZ banks, like the supermarkets are some of the most profitable in the world.
What will be interesting to see is the response of the banks to the lift in tier 1 capital requirements here in NZ from 10.5% to 16%. My guess is absolute profits will lift further to protect the returns against the higher capital base.
The banks disclose NZ profits and they are definitely good, however excessive?? The definition of that gets very murky very quickly. As I said at the start, it would be a very difficult tax to implement.
NZWarriors.com
But why MUST they be the same? And why have other countries implemented it?
Shouldn't it just be a cost for them to comply with for the opportunity to generate profits out of our country.
Why is it murky?
There is already the test cases of other countries doing it.
Kinda funny the most vocal critics of dole bludgers on this forum are also the most vocal about taxing excess corporate profit.
Is it hard? The banking sector seems like the easiest - as we have the same companies operating in Australia. Are their profits higher in NZ than in Aussie per customer? If so, tax the difference.
NZWarriors.com
Different markets, different risks with different capital requirements, it’s not as simple as taxing the difference. Plus if a windfall tax was introduced then for many industries it will eventually just be passed on to the consumer anyway.
It's a thing elsewhere can be done.
ANZ for instance - with their $2.2b profit can definitely afford it and can still be doing pretty well for themselves.
There are two main problems with capital gains taxes….. first, three of the four most unaffordable countries to buy a property have a CPT so having one doesn’t mean that houses become “more affordable”.
The other main problem with Capital Gains Taxes (and wealth taxes) is the cost of administering the schemes. The cost for the collection of GST, individual and corporate tax falls mostly on businesses while the cost for the administration of the collection of CGT and WT falls mostly on the government. They don’t offer the financial return to the government..
NZWarriors.com
@miket12, you work in the industry.
What would help bring house prices down in your opinion?
Increasing sector capacity (labour & materials, more capacity in alternative building methods - modular)?
Would MDRS have helped?
Do we need to break up Fletchers?
Land tax?
All of the above.
