Matthew Gilligan's Blog - Response to Academics calling Landlords Landed Gentry

[donna]

Hi All,

I encourage you to read Matthew Gilligan's blog post - a reply to a couple of academics pushing for tougher taxes for property owners. The annual equity tax - where you could be up for paying a tax on the increase in equity in your property - even though it's not realised. Odd I thought we did pay the increase albeit it maybe not annually - it's called 'rates' which we know the amount is partly based on property value. My rates have skyrocketed all due to increase in property values - but no mention of this existing tax by the 'academics'.

Anyway here is the link to Matthew's blog post - https://www.gra.co.nz/articles-by-ma...landed-gentry-

A couple of nuggets......

According to Baucher and St John, due to property owners’ real estate fortunes, their incentive to work and contribute in a meaningful way is blunted.

To Baucher and St John, I want to say property investment and being a landlord is meaningful, hard work. Landlords are not a gold-plated class of oligarchs, fox hunting in the morning and sipping champagne in the afternoon funded by ill-gotten (untaxed capital) gains. Investors are actually, on average, middle New Zealand mum and dads trying to create a retirement income and provide for their kids.

Read Matthew's solutions - why do you think?

cheers,

Donna

[Perry]

One point passed over was that said academics are de facto paid from gummint taxes.

So the distant-from-reality, ivory-tower dwellers say the things the money providers want them to.

I.e. They who pay the pipers call the tune.

[PC]

The know it alls aren't listening anyway.
They know they are right and hate us deplorables.
Consultation is an annoying box that gets ticket or ignored.
Let's hope NZ can survive another 2years of this terrible Government.

[simongu]

Fantastic article, shame it will never make any difference to the ideologues in power who I genuinely believe want to eliminate private landlords over time. Shudder thinking about what they will do in their 3rd term

[Minz]

A great article and I also note other 'charging' problems:

"Don’t charge developers a development contribution that exceeds the cost of their actual pro rata share. All this does is encourage developers to land bank and sit on the land undeveloped because they feel like they are being taxed through the back door with exorbitant development levies. If you want supply, do what they did in Australia and forward-fund the 20 years of future development infrastructure. Charge developers a pro rata and fair connection fee as they connect to the infrastructure. There is talk at the moment of doubling development levies and there’s consultation going on about it. Quite simply, if this happens, many developers will just sit on their hands, and this will undermine supply. Moreover, developments that do proceed will simply pass the cost on to the buyers. Government needs to socialise the cost of forward funding, with a long-term scheme socialising the cost over the total potential number of connections. Not slam the current developers in a tax grab."

Absolutely- the 'rip-off' includes more than just the DCs as many will have have experienced:

(1) take the developer who had Vector attempt to charge $150k for connecting 13+ units, this was shown to be wrong after 8 months of negotiation and the net charge was $30k. This is not a one-off (another was presented with a 400k charge, and another managed to get a 'savings' of 110k after extensive discussion with Vector).

(2) Traffic Management: the installation of public drainage cost one development c$120k (for full labour, diggers, bracing etc), on top of that was a charge of c$40k for the TMP (a dead end street with barely any traffic - albeit close to a minor arterial route). The TMP is made up of 'safety' costs and no doubt allocations to AT - the base daily rate is $530 for the privilege of the cones and signs and probably some other components - checking? So what makes up the remaining $1,500 per day?).

Yes, property developers and landlords line the banks of many councils, utility providers, and government departments - all paid for by the house buyer and also influencing the capital values.

[Bluekiwi]

The socialist communists comrades have taken over the good ship New Zealand.
All ye capitalists shall be thrown to the wolves comrades.