Kia ora. Long stories short, here’s my top six things to note in Aotearoa’s political economy around housing, climate and poverty on Tuesday, October 1:
PM Christopher Luxon has made $460,000 in tax-free income this year from capital gains on the sale of two of his rental properties, almost as much as the $484,200 gross income from his actual job, which he, like other earners of wages, has to pay tax on. Asked about not paying tax on the income from capital gains, he said he didn’t see the point of questions about a capital gains tax as it removed the incentive for wealth creators. 1News
In the scoop of the day, Guyon Espiner reported for RNZ yesterday that officials advised NZ First Minister Casey Costello that most of the benefits of the Gov $216 million tax cut for heated tobacco products would go to Phillip Morris.
In the deep-dive of the day, Public Housing Futures has produced a map of stalled and empty Kāinga Ora sites throughout the motu, showing thousands of half-finished or bare land where work has stopped, despite close to 100,000 people being registered as homeless. See more in an interview below, done the day after Luxon moved into Premier House, now the drapes and carpets and paint are up to his preferred standards.
In solutions news, the world’s largest battery maker, CATL, has announced it is moving long-life vehicle batteries to production that will last 15 years or 1.6 million kilometres, with a ten-year guarantee.
In quote of the day, Clutha Mayor Bryan Cadogan says he is livid the Government has chosen $14 billion in tax cuts over a proper hospital for the lower half of the South Island.
In charts of the day, business confidence about the future economy and firms’ own futures improved markedly in September, but actual experienced conditions remain in recession territory.
(There is more detail, analysis and links to documents below the paywall fold and in the podcast above for paying subscribers. If we get over 100 likes we’ll open it up for public reading, listening and sharing.)
1. Luxon says wealth generators need tax incentive
Luxon makes more in tax-free income from capital gains than PM’s salary
PM Christopher Luxon was questioned yesterday about the $460,000 in tax-free income from capital gains he is reported to have made this year from the sale of two rental properties, including his apartment in Wellington now that he has moved into Premier House. His gross annual salary as PM from July 1 was $484,200, which IRD’s calculator shows would require he pay $168,260 in income tax, if that was his only taxable income.
He was first asked if he should pay tax on the capital gains income.
“No, we don't have capital gains tax in New Zealand. We think it would be bad for New Zealand because you don't tax your way out of recession."
Asked if he made good money off the sale, Luxon said the "sale is still progressing".
"I don't know what the point of the questioning is.” Luxon via 1News’ Maiki Sherman last night. (From 4:52 on in the video below)
Luxon went on to say wealth generators needed the incentive of not paying tax on income from capital gains.
"We don't believe in a capital gains tax or a wealth tax. We think, for people who actually generate wealth in this country, it's a massive disincentive and as I've said along the way this is a Labour government that took the keys to our economy, put the car in the ditch.
“We're getting it out of the ditch and they want to put it back in there again by increasing taxes, by increasing spending and borrowing more." Luxon.
2. Scoop of the day:
Guyon Espiner reported for RNZ yesterday that officials advised NZ First Minister Casey Costello that most of the benefits of the Gov $216 million tax cut for heated tobacco products would go to Phillip Morris.
Honorable mentions
Health: The 3 key documents about Dunedin Hospital yet to be released RNZ
Auckland: Auckland mayor seeks to scrap city’s economic development agency. Tātaki Auckland Unlimited has been criticised and its budget slashed ‒ and it now faces being disestablished completely The Post-$$$’s Dita De Boni
Councils: Govt's lack of faith in Hawke's Bay Regional Council revealed in letters. Minister for Local Government Simeon Brown told the council he didn’t believe it could deal with situation without a Crown Manager appointed. Stuff’s Marty Sharpe
Health: Man waited at ED for more than an hour as blood poured from his mutilated fingers. He was made to stand in a queue after a workplace accident. Stuff’s Shilpy Aurora.
3. Deep Dive: Mapping less homes and morehomelessness
Housing activist group Public Housing Futures has produced a map of stalled and empty Kāinga Ora sites throughout the motu, showing thousands of half-finished or bare land where work has stopped, despite close to 100,000 people being registered as homeless. I spoke below with Public Housing Futures’ Vanessa Cole about the map and the data
Honorable mention
Climate: No new gas likely for 10 years despite Govt exploration plans. Repealing an oil and gas exploration ban is unlikely to significantly bolster gas supplies in the short term, according to government modelling. RNZ’s Eloise Gibson
4. Solutions news: A battery for buses lasting 1.6m kms
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