Experts question why Labour remains quiet over capital gains tax following bombshell IRD report

An explosive $5 million report into the disparity between the tax ordinary New Zealanders pay compared with the super-wealthy was released this week but what followed was silence over Labour's tax policy.

The Revenue Minister has confirmed Labour will not be announcing tax policy just yet, but Opposition parties say the report is readying the electorate for more taxes. 

However, a former National press secretary said the party is likely sitting back to test the waters before jumping in with any decisions. 

For over a decade, Labour has been floating around the idea of a capital gains tax (CGT). In 2011, Labour, then led by Phil Goff, campaigned on implementing a 15 percent CGT.

However, in 2019 then-prime minister Jacinda Ardern put an end to the debate, ruling out a CGT under her leadership.

But now with a new Labour leader in charge and an explosive report into how much tax wealthy New Zealanders have been paying, the CGT has made its way back into the spotlight.

On Wednesday, an IRD report commissioned by the Government found the effective tax rate paid by New Zealand's wealthiest families is less than half of that of middle-income Kiwis.

Revenue Minister David Parker said on Wednesday that the data confirmed "fundamental unfairness in our tax system", but made no announcements about what steps Labour could take to improve the system. 

He said Labour will announce its tax policy before the election and its current position of no new taxes - outside the new 39 percent tax rate - this term continues to stand.

Appearing on Newshub Nation's political panel, Victoria University Associate Professor in Politics Lara Greaves questioned Labour's tight lips on tax policy after revealing the bombshell report.

"Normally what happens is when you come up with some research, especially $5 million worth of research, you want to have a banger of an implications section where you go 'hey, here's the policy implications'," Dr Greaves told co-host Rebecca Wright. 

"Are they just going to do a slow reveal? Like what is happening?"

Former National press secretary Janet Wilson told the panel it could be "dangerous" for Labour to run again from a CGT.

She called the IRD report a "strip tease".

"I think what they are doing is fling their kite to see how it flies… whether it's going to rike the nation up and it's going to become the hot button issue that they hope it's going to become," Wilson said.

Wilson expects Labour to "poll endlessly" before making a decision on what they are going to do - which she predicts won't come until after the election.

Watch the full panel above.

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