Bach, boat and beemer targeted in Budget
By Patrick Gower
The bach, the boat, and the BMW could all be in for a visit from the taxman in tomorrow's Budget.
Finance Minister Bill English is lining up high-income earners who have been using homes and vehicles as tax write-offs, in order to bring in more much-needed tax revenue.
He says it's sensible to crack down on tax loopholes exploited by the wealthy.
“In the Budget, there will be a few more tax measures that tighten up where we believe people are avoiding their obligations and that will be focussed mainly on higher income earners,” he says.
The changes mean a bach owner will not be able to write-off tax even if the bach is just occasionally rented out.
Geoff Nightingale from PriceWaterhouseCoopers says bach owners are essentially milking the system.
“When you add the available-for-use days with the days rented, people are getting about 95 percent of their costs as a deduction,” he says.
It's nowhere near a Capital Gains Tax - which National continues to rule out - but it could bring in hundreds of millions for the Government.
A technical loophole closed on livestock tax earlier this year is estimated to save taxpayers $275 million over six years.
Smokers will definitely get taxed more too.
So 3 News asked if drinkers will get hit as well
“Look, you will just have to wait and see until tomorrow. I'm not going to speculate,” he says.
It will be far from an austerity Budget by current international standards, but English's ‘pretty sensible Budget’ will, in New Zealand terms, be pretty tight.
source: newshub archive