Simon Bridges says the present capital gains tax on property investment is already fair, and there's no need for the "most radical, hairy-chested capital gains tax and tax reform New Zealand has probably ever seen".
The Government's Tax Working Group has recommended introducing a capital gains tax, offset by lowered personal income taxes, Prime Minister Jacinda Ardern saying it would give average Kiwis a "fair go".
"It's about getting a fair go, and paying your fair share," she said in a press conference on Monday.
But Mr Bridges told Newshub Nation on Saturday the proposals put forward by the Tax Working Group would make the tax system less fair, rather than more.
"What is fair about someone in Oriental Bay in Wellington with a million-dollar property paying no capital gains tax and someone with a $700,000 property, a lifestyle block out in Wairarapa paying full capital gains tax? I could go on and give you example after example," he told host Emma Jolliff.
This is because the report calls for capital gains taxes on investment properties and lifestyle blocks over a certain size, but not the family home.
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He said the two-year brightline test introduced by National - later increased to five years by the present Government - was fair.
"Because really all it was, was an evidential test that said if you were involved in rampant property speculation, you were flipping houses over every year, then you shouldn't be doing that. Or rather, if you did do it, you should pay tax on that."
Asked if it was fair that wealth is becoming increasingly concentrated and demand at food banks was rising, Mr Bridges said they were "serious issues" that wouldn't be solved by a capital gains tax.
"In the report itself, they make quite clear it's not going to solve housing inequality issues; it won't address those issues that you are talking about in that report. If we want to build more houses, let's have comprehensive reform of the RMA, of the planning systems, let's free up land and get into it.
"But a capital gains tax is not going to do the deal on those issues that you, that I, that New Zealanders care about."
Any capital gains taxes would only apply to gains made after 2021, if the recommendations are adopted - so property owners who've benefitted greatly from the rise in values over the past decade would be largely unaffected.