Charities receive a tax exemption on income. People donating to charities receive a tax exemption on the donation. The problem that we have is that there are many charities that engage in commercial activity, and as a charity their profits are exempt from tax, but there is no obligation to actually use any of the profit for charitable purposes. Think iwi, church organisations like Sanitarium, etc. One answer might be to tax the profits, and where those profits are used for charitable purposes, then they receive a tax exemption. That might encourage more charitable fiving. Otherwise, the State is simply subsidising commercial businesses.
Probably not, unless it is pursued as an issue. Politically, the problem is how to deal with the churches, and with iwi, when it comes to appearing to impose a tax on charitable businesses. Some, like Sanitarium actually transfer most of their profits to the religious arm of the Seventh Day Adventist church for the pursuit of religious purposes. Others appear more invested in growing their businesses, with very little money being transferred. People may be surprised as to the extent to which businesses are placed in to the charitable sector, many of which are done for good reason. However, sometimes the initial charitable intent can be lost as the focus returns to developing the business. For an example, readers might be interested in reviewing the financial statement of the Joan Fernie Charitable Trust on the Charities Register. This is not an isolated example, as there are many that are similar. What it demonstrates is a charity with substantial assets, a significant income, and relatively little going to charitable purposes. In previous years the amount going to community organisations was much less. With a little analysis, it can be seen that amount of tax forgiven because of the charitable status, well outweighs the amount which actually goes to a charitable purpose, which means that the State is essentially subsidising the business.
I'd love to see a closer look by government at charities and tax. I have no problem with genuine charities' tax-exempt status but huge issues with profitable businesses masquerading as a charity. I also question purely 'promoting religion' as a charitable enterprise - would need to include elements of support for homeless, ill, poor etc to qualify surely ....
It is not clear to me how a CGT makes housing more affordable. Apparently Romania has the most affordable housing globally, yet has a CGT less strenuous than the bright line test in NZ. (16% dropping to zero after 3 years).
If the purpose is to slug the rich that's fine, just be clear about it.
Is it me or is it ironic our country's CEO - sorry, PM - is criticising the head of ANZ for supporting the long-overdue CGT for taking "more money off New Zealanders" when his government is actively doing the same in the short- and long-term via its suite of policies?
Has there ever been a time when money was transferred from school budgets that taught, French, Latin or German. Of course not. In many ways Te Reo would be a useful alignment to the NZ history classes we presume are already scheduled.
We have a taxation crisis in NZ pure and simple. Middle NZ is divided because they pay the biggest burden via PAYE. The low waged pay too much tax for their earnings whilst the rich kids duck paying their fair share. Health, education and infrastructure are woefully underfunded, but yet again it is those without medical insurance or funds for private education who bear the brunt of this short fall. Hipkins will not find any answers from a British Labour Party under Starmer who is removing winter fuel subsidies from pensioners to pay for his £22billion shortfall. A Labour Party that refuses to tax those who are avoiding their duty to share their wealth will never regain my trust or vote! I paid tax on every dollar I ever earned, why the heck people with hidden assets are allowed to get off is Symptomatic of a very corrupt country.
Labour leaders' ritual pilgrimage to prostrate themselves before Blair and Mandelson and align policy with 'old country' Labour. Maybe Starmer will be beyond the pale for Hipkins now he's fully stepped into Tory shoes?
Wonder if he'll speak to Corbyn? Would be a scandal (or maybe not) if that came to light!
My partner's business has been twice "screwed over" by a subsidiary of Sanitarian. On both occasions my partner's lawyer has advised her to "let it go" on the grounds that they have "deep pockets" and could defend themselves indefinitely in court action. The day is long overdue when Sanitarian should be on the same level playing field with other text paying businesses.
'Capital gains' is really just income. If Income is derived by buying something then selling it a bit later for rather more, it's still income. Tax would be paid only on the profit - broadly, the difference between before & after price. Most people earning a salary generally pay tax at source on their income so where's the difference, except in amounts?
🧐CGT & alternatives is a nuanced & complex subject that I personally am not qualified to completely understand, except to say "everyone should pay their fair share" 🤷 Certainly "charitable status" is blatantly abused by some "charities" who are in fact total commercial enterpises with some token "charity" overtones which fool no-one but their followers. And the idea that people buy & sell properties just for capital gains sounds like taxable income by any definition?
However, I DO understand the political sensitivities from major parties as a personal anecdote shows - I don't recall the exact details, but a couple of decades ago approx Labour (I think?) proposed some kind of policy re people owning more than one property other than their family home. The opposition beat it up to mean it included caravans, motorhomes etc. and someone I knew heard nothing else but that to switch allegiance to a party that opposed that single policy 😱 Irrelevant that this was not true - perception is what ruled then, and unfortunately rules NOW, even with much wider access to true information. Therefore, whatever changes are proposed, it will need a broad coalition behind it & some clarity of explanation that can break through the vested interests who have mega $$ to undermine it. 🤔
I was good at mathematics, but, many times in my life I have envied those that were fluent in more than one language. I think teaching of basic Maori language in our schools and more focus on New Zealand history would be a cost effective way of reducing racism.
Charities receive a tax exemption on income. People donating to charities receive a tax exemption on the donation. The problem that we have is that there are many charities that engage in commercial activity, and as a charity their profits are exempt from tax, but there is no obligation to actually use any of the profit for charitable purposes. Think iwi, church organisations like Sanitarium, etc. One answer might be to tax the profits, and where those profits are used for charitable purposes, then they receive a tax exemption. That might encourage more charitable fiving. Otherwise, the State is simply subsidising commercial businesses.
Do you reckon we'll see something like this put on the agenda for the next election? – SSL
Probably not, unless it is pursued as an issue. Politically, the problem is how to deal with the churches, and with iwi, when it comes to appearing to impose a tax on charitable businesses. Some, like Sanitarium actually transfer most of their profits to the religious arm of the Seventh Day Adventist church for the pursuit of religious purposes. Others appear more invested in growing their businesses, with very little money being transferred. People may be surprised as to the extent to which businesses are placed in to the charitable sector, many of which are done for good reason. However, sometimes the initial charitable intent can be lost as the focus returns to developing the business. For an example, readers might be interested in reviewing the financial statement of the Joan Fernie Charitable Trust on the Charities Register. This is not an isolated example, as there are many that are similar. What it demonstrates is a charity with substantial assets, a significant income, and relatively little going to charitable purposes. In previous years the amount going to community organisations was much less. With a little analysis, it can be seen that amount of tax forgiven because of the charitable status, well outweighs the amount which actually goes to a charitable purpose, which means that the State is essentially subsidising the business.
I'd love to see a closer look by government at charities and tax. I have no problem with genuine charities' tax-exempt status but huge issues with profitable businesses masquerading as a charity. I also question purely 'promoting religion' as a charitable enterprise - would need to include elements of support for homeless, ill, poor etc to qualify surely ....
It's interesting because it seems there is political consistency on the issue but no one is willing to make the first move... – SSL
A Capital Gains Tax is well overdue, and would solve multiple problems, including speculation on housing stocks.
It is not clear to me how a CGT makes housing more affordable. Apparently Romania has the most affordable housing globally, yet has a CGT less strenuous than the bright line test in NZ. (16% dropping to zero after 3 years).
If the purpose is to slug the rich that's fine, just be clear about it.
Or you could call it evening-up tax paid on different ways of making income
Yes, agree all income should be taxed, but not sure how a CGT would achieve housing affordability any better than in other countries.
Is it me or is it ironic our country's CEO - sorry, PM - is criticising the head of ANZ for supporting the long-overdue CGT for taking "more money off New Zealanders" when his government is actively doing the same in the short- and long-term via its suite of policies?
What would you expect from Christopher Fricken Seven Houses Luxury?
Has there ever been a time when money was transferred from school budgets that taught, French, Latin or German. Of course not. In many ways Te Reo would be a useful alignment to the NZ history classes we presume are already scheduled.
We have a taxation crisis in NZ pure and simple. Middle NZ is divided because they pay the biggest burden via PAYE. The low waged pay too much tax for their earnings whilst the rich kids duck paying their fair share. Health, education and infrastructure are woefully underfunded, but yet again it is those without medical insurance or funds for private education who bear the brunt of this short fall. Hipkins will not find any answers from a British Labour Party under Starmer who is removing winter fuel subsidies from pensioners to pay for his £22billion shortfall. A Labour Party that refuses to tax those who are avoiding their duty to share their wealth will never regain my trust or vote! I paid tax on every dollar I ever earned, why the heck people with hidden assets are allowed to get off is Symptomatic of a very corrupt country.
Labour leaders' ritual pilgrimage to prostrate themselves before Blair and Mandelson and align policy with 'old country' Labour. Maybe Starmer will be beyond the pale for Hipkins now he's fully stepped into Tory shoes?
Wonder if he'll speak to Corbyn? Would be a scandal (or maybe not) if that came to light!
Our tax system: bases and regimes: Consultation on the scope of Inland Revenue’s long-term insights briefing.
The closing date for feedback is 4 October 2024.
https://www.taxpolicy.ird.govt.nz/-/media/project/ir/tp/publications/2024/2024-feedback-ltib/ltib-summary.pdf
Thanks for sharing the link :) – SSL
My partner's business has been twice "screwed over" by a subsidiary of Sanitarian. On both occasions my partner's lawyer has advised her to "let it go" on the grounds that they have "deep pockets" and could defend themselves indefinitely in court action. The day is long overdue when Sanitarian should be on the same level playing field with other text paying businesses.
'Capital gains' is really just income. If Income is derived by buying something then selling it a bit later for rather more, it's still income. Tax would be paid only on the profit - broadly, the difference between before & after price. Most people earning a salary generally pay tax at source on their income so where's the difference, except in amounts?
🧐CGT & alternatives is a nuanced & complex subject that I personally am not qualified to completely understand, except to say "everyone should pay their fair share" 🤷 Certainly "charitable status" is blatantly abused by some "charities" who are in fact total commercial enterpises with some token "charity" overtones which fool no-one but their followers. And the idea that people buy & sell properties just for capital gains sounds like taxable income by any definition?
However, I DO understand the political sensitivities from major parties as a personal anecdote shows - I don't recall the exact details, but a couple of decades ago approx Labour (I think?) proposed some kind of policy re people owning more than one property other than their family home. The opposition beat it up to mean it included caravans, motorhomes etc. and someone I knew heard nothing else but that to switch allegiance to a party that opposed that single policy 😱 Irrelevant that this was not true - perception is what ruled then, and unfortunately rules NOW, even with much wider access to true information. Therefore, whatever changes are proposed, it will need a broad coalition behind it & some clarity of explanation that can break through the vested interests who have mega $$ to undermine it. 🤔
I was good at mathematics, but, many times in my life I have envied those that were fluent in more than one language. I think teaching of basic Maori language in our schools and more focus on New Zealand history would be a cost effective way of reducing racism.