Capital gains tax: Could Winston Peters change his mind?

Winston Peters appears to be softening his view on capital gains tax (CGT), after previously saying he wasn’t keen on the idea.

Before the 2017 election, the New Zealand First leader said a CGT was "off the table". In the Newshub ASB Great Finance Debate at the time, he said: "They won't work in this country. They won't work in any other country. They never have worked."

But when confronted by Magic Talk's Peter Williams about his former views on CGT, the Deputy Prime Minister said on Tuesday: "When you're presented with a new set of circumstances, then it's wise to actually consider it before confirming your former opinion."

"Capital gains tax is just one of the things [recommended in the Tax Working Group's report] - there were a whole lot of other suggestions made," he said. "Given the quality of that committee... we need to consider them very seriously."

He added: "Fairness is what the New Zealand people should expect from the Government."

On Monday, Prime Minister Jacinda Ardern appeared to be lining up with that view. She used her post-Cabinet media conference to give farmers and small businesses an assurance they would be front of her mind when weighing up a CGT. 

As a coalition Government, Ms Ardern will have to consult with both New Zealand First and the Greens about the proposed changes to the tax system. 

Mr Peters wasn't the only senior Government minister trying to defuse criticism around CGT on Tuesday. 

Finance Minister Grant Robertson told a business breakfast gathering at Eden Park: "It's change and change is always challenging for people."

He said it's important for people to remember that "we haven't made a decision yet", reminding the crowd that the Tax Working Group's report provided suggestions for the Government that do not have to be implemented.

The Prime Minister made similar comments on Monday, saying there needs to be a debate about the Tax Working Group's recommendations before a decision is made.

"Let's debate the actual report rather than simply making things up," she said, criticising National leader Simon Bridges' comment that the proposed tax would be an "assault on the Kiwi way of life".

The Tax Working Group released its recommendations last week, including a CGT on gains and losses on land improvements (except the family home), including shares and business assets. It would not apply to personal items, like bikes, boats and art. 

The CGT would be set at the income-earner's top tax rate, likely to be 33 percent for most people, which Mr Bridges said on Thursday, was "one of the highest rates of capital gains tax in the world".

The Government will give its official response to the TWG's recommendations in April, after the public has had the opportunity to debate the issue.