Yeah, ok. Maybe post that again, with a bit more substance, when we are in the right context, e.g. the Environment Policy?

PLEASE GET RID OF ALL FERAL CATS IN NEW ZEALAND!!!!!!

Hi Matt. You’re lucky you put that almost in your comment “walking is almost always good for the mind. 8-)” Sometimes my co-workers aren’t impressed by the conclusions I can reach, or the subject. And how did you know I wear glasses 8-) ?

Fairness. Now that is a loaded word. I’m not going to answer your question (or the reformatted one) directly, but I’ll ask a few of my own.

Is it fair that those who are trying to save money (for a house, retirement, a new car, that holiday) only receive 2% interest whilst the profligate who just want to spend, spend, spend pay relatively low interest on their borrowings?

is it fair that if I holidayed within NZ I’d pay GST of 15%, but if I holiday in Fiji i pay none?

Is it fair that a minimum wage earner and a person on a million dollar plus salary should pay exactly the same fine for speeding. Wouldn’t it be fairer to fine each of them a set percentage of their income?

Is it fair that a factory owner sells off the part of the land where the workers car park is (to lessen his TOP Tax) and expects them to try and find a park on the street?

Is it fair that a farmer has to get up at 3:00 am to shift stock to higher ground in case of flooding (a benefit of the farm?) whilst a town renter gets to stay snuggled up in bed?

Is it fair that a couple who have foregone extravagances over the years so that they’d have a debt-free house to live in when they retire must now pay ten times as much TOP Tax as the rentier who has loaded his rentals up with debt, planning to make his money off the tax-free gain when he sells?

I’m not opposed to the TOP Tax, but bringing fairness into it just opens up a can of worms – see questions above.

Matt if I am to understand question posed is it the difference between a renter with money in government bonds enough to buy a farm & a farmer with that same capital at work in a farming enterprise?

I’d have to say the difference is night & day.

The renter is earning a passive income which for all intents and purposes is a capital protected asset in the form of Government bonds. Their capital is indistinguishable from any other investment of the same value in government bonds. Their capital does not generate further employment & the benefit to NZ wealth is limited to the yield of the bond being retained in NZ vs being sent offshore should a foreign entity have owned those same bonds.

The farmer on the other hand is applying the same value capital to work in a productive asset class. Their are real risks to the potential income selling farm produce as well as the value of the underlying land through forces of nature such as floods, droughts, earthquakes, disease outbreaks etc. The farmer is generating significant economic activity in their local economy creating jobs for fellow kiwis, fertiliser sales people, fencing contractors, harvestor drivers, shearing gangs, freezing workers, cool store operators, wine makers, mechanics, engineers, tractor sales people and on and on and on.

So in good years everybody would hope the benefits of owning the land would generate income sufficient that no TOP tax topup would be required on those rural assets.

The years when the benefits of owning the land do not generate income sufficient and a TOP tax topup is required would then be at a time when the farm likely suffering from the impacts of adverse natural events (drought, disease etc) or perhaps the cyclical downturn in the markets they supply into causing losses.

I know farmers that have had their houses destroyed in the recent Kaikora earthquakes. They also have $100,000s of damage to fences & farm tracks, wool sheds etc. If they make no money in the next few years while rebuilding their property this would be the time the TOP tax would engage & you are suggesting they should pay an extra tax because they own a valuable assets that isn’t generating sufficient income to your liking. WTF? Time to get your head out of the textbooks on economic theory & into the real world.

Two fundermental questions needs to be asked before any TOP tax topups could even consider to be applied in a real world situation.

1) Does the assets typical income generation fall into a passive income category or an active income category which the owners put their capital at risk to earn an income & also the social bargain of generating employment and auxiliary economic activity?

2) Why is the capital not returning sufficient income tax under the current system? Is the assets producing little to no income (or a loss) due to environmental factors, i.e. weather, climate, natural disaster, cyclical downturn in export markets due to GFC etc. Alternatively is the low income or loss a byproduct of a planned financial structure to minimise income tax for long term tax free capital gains.

Sorry to say this but anybody who proposes the virtue of slapping additional taxes on businesses facing financial difficulties due to environmental factors is a fucken dick head. These people (especially farmers) have applied their capital in the prospects of being productive contributors to NZ’s economy in good faith, but with financial troubles suffer highetened levels of depression, mental health issues & suiside. You do not kick a dog while it’s down.

If you want to catch out slippery characters who structure their investments in passive & unproductive assets such as housing with the intention of avoiding income tax through negative or even gearing while expecting to profit tax free from capital gains, well fill your boots!!

What I’m trying to say is a blanket across the board tax that ignores passive investments vs productive asset classes, structural or strategic tax minimisation vs environmental or situational losses would be untenable.

Say a farmer goes from a highly profitable cherry orchard to losing access to key markets in Japan because of a diplomatic incident with the Ministry of Foreign Affairs and Trade. Is it right for the Government to tax them a percentage of their assets values because they are not paying enough income tax when their inability to turn a profit is the result of MFAT & Japan falling out over something unrelated like whaling in the Southern Ocean?

Does the simplicity of an across the board tax with no exception justify the cost in human life you will create with financially stressed farmers in the middle of a drought taking a shotgun out of the cupboard one last time to end it because they don’t have the money to pay the TOP tax topup? (If you don’t believe this will happen I suggest you read this link http://i.stuff.co.nz/business/farming/dairy/79221368/suicide-concerns-rise-for-farmers-as-dairy-downturn-takes-its-toll )

Guys, you have to get your math right. At the moment Kiwi Bonds are offered at 2% pa interest rate for a 2-year term, see here:
http://www.interest.co.nz/saving/term-deposits-1-to-5-years
So let’s assume that is the minimum asset return rate for TOP 1 tax purposes.
Rob Anderson, you write “a Marlborough/Canterbury Hill Country Farm only returns $138,000 before tax on a $5,000,000 farm that’s a 2.76% return on capital”. That means the farm is more profitable than selling it for $5m and investing the money in government bonds, so there’s no TOP 1 tax to pay at all, even if it was completely debt-free. You pay your regular income tax based on your personal rate for that income, and you’re done.
You cannot base your logic on a 5% tax on capital or asset – that is not how it works, and it could never be that high, either. I paid tax on the FDR for a few overseas assets for a while, and the tax wasn’t 5% – it was 30% or 33% (depending on the tax bracket) of 5%, meaning the tax I paid was 1.5% or 1.67% of the capital value. A TOP 1 tax based on the current government bonds return rate would mean 0.67% tax of the equity for a top earner in the 33% tax bracket.
Please make sure your math is based on these numbers before you state your case and ask for a tax exemption.

Actually, I’ll reformat the question for Steve just below to a further question:

Is it fair for a farm owner to receive the benefits of the farm land they own without those benefits being considered as income for tax purposes?

Compare the farm owner with a person who lives in a town rental but has money enough to buy a farm in a bank account. That person will be taxed on the interest paid (I.e. taxed on the benefits of money in the bank).

Steve: walking is almost always good for the mind. 8-)

Here’s a question for your next walk:

Is it fair for a home owner occupier to receive the benefits of the home they own without those benefits being considered as income for tax purposes?

Compare it with a person who lives in a rental but has money enough to buy a house in a bank account. That person will be taxed on the interest paid (I.e. taxed on the benefits of money in the bank).

Hi Matt

A walk to and from work has given me a bit of thinking time to digest your comments. So here goes.

IRD for an owner/occupier: – Access the rateable value of the property (from the council), deduct the mortgage (as advised by the bank) to arrive at Net Value. Multiply by 1.5% and send a please pay request.

IRD for a rentier: – Repeat above stages except for the please pay request. Access the owners tax return and see what the rental profit was. Determine the income tax on that profit. If greater than the TOP Tax then they owe nothing more. But if they owe less income tax then they get a please pay request for the difference between TOP Tax and income tax.

if the above is basically correct then i see no fairness problem on the taxing side of things. Well except for your own admission that some asset classes may need to be treated differently.

I’ll save my “devils in the detail” comments till the above is confirmed as it’s not productive to say “what about …” when I may be going off on a wild goose chase.

Steve: I would analyse your rentier vs owner occupier as follows.

The rentier pays no “TOP tax” because the income generated is above the minimum.

The owner occupier receives benefit in kind from the asset equivalent to the $25K the rentier makes in profit. The owner occupier pays income tax on the “TOP minimum income” which in your example is likely less than the $25K, depending on the bond rate.

It seems the owner occupier does a little better than the rentier (assuming identical marginal income tax rates).

Looked at this way the tax looks about as fair as you could get without having individualised determinations of the $ value of benefits in kind received from owning an asset. The tax does still need individualised valuations of assets.

Changing the $25K to $12K (an income below the top minimum) simply means that both the rentier and the owner occupier pay the same (the tax on the top minimum at their identical marginal rates).

To get this analysis to work out, you have to be prepared to consider the income in kind the asset provides the owner occupier. It’s then all beautifully consistent.

I do think there may be a case for having discounted rates of “TOP minimum income” for some classes of assets. It would detract from the simplicity and universality of the tax. But that’s another story. -Matt

Down try to tell the rest of NZ how hard done by landlords in Auckland are. The rentiers in Auckland don’t have equity in what they own. They buy a $900,000 property with maybe $50,000 to $100,000 cash and use another property for equity (one that is being rented and costs them nothing to own). After 12 months they sell for a $1,000,000 after the smoke clears they have gained $50,000 to $80,000 profit from their initial $100,000 investment. Thats the reality of Auckland property, a big Ponzi scam,

Matt the 5% was arbitrary, and just so happens to be be used currently by FDR. If it tied to the Government bond rate and fluctuates between 3-6% deemed income that really isn’t much different from 5%.

Now what about the rest of the questions raised?

What has been modelled for forestry? They only get paid once every 30 years? Where is the cash going to come from to pay the TOP tax every year?

What about farmers suffering from a regional drought?

The majority of tax payers live in the 3-4 main centres. The TOP tax proposal is intended to be total tax take neutral. The TOP Tax proposal will collected large areas of the rural sector and increase the total rural tax burden. The reduction to income tax to keep the total tax take neutral will be be disbursed in major centres by virtue of that being where the majority of tax payers reside.

Has anybody actually bothered to model the impact to the rural sector using Ministry of Primary Industry model farm data?

What about the issues raised about liquidity and divisibility of the assets and the ability to fund the proposed TOP tax payments?

Yes incorrectly calculated the tax below apologies for that. The rest of the questions are a little more important to be answered that pointing out a minor math error.

Hi Matt
Several commentators have complained on other threads about the unfairness of this tax between rentiers and owner/occupiers. Rentier – a person who lives off income from property.

Lets say a rentier owns a rental property with $400,000 net equity. He pays TOP Tax of $6,000. In renting that property out for the year he makes a profit of $25,000 and lets say his marginal tax rate is 30%. So he owes income tax of $7,500 less the $6,000 he paid as TOP Tax leaving a net tax bill of $1,500. Overall the rentier pays tax of $7,500 – no more than he would have paid anyway.

An owner/occupier with the same net equity pays $7,500 in TOP Tax and cannot offset it against other tax. Fair?

What if the rentier had only made a profit of $12,000? Income tax on that is $3,600. But he’s paid $6,000. What happens to the other $2,400? Is it used to offset against other income tax liability?

Have I got the logic right?

The TOP tax proposal is NOT to slap a 5% tax on the value of all assets. It’s to tax all assets at a minimum as if they were producing an income equal to the government bond rate, say 3-6% over the last decade. Assets that produce more income than the minimum will not be affected by the tax. With a business income tax rate around 30% that implies a minimum tax rate or 1-2%.

Hi Matt,

Yes I do think this tax proposal is seen as a solution to a Auckland problem and also an attack on rural New Zealand.

If house prices in Auckland double and the level of debt as a percentage of house value stays the same the country becomes less productive. The doubling of debt is largely financed by Australian owned banks and the interest / profits associated with this increased debt is detrimental to the countries international balance of payments. More money leaves the country to pay the loans on the increased house prices and there is no benefits to the ability of the country to generate foreign exchange.

The high valuation on the rural land, particularly in the beef and sheep sector, is driven at least in part by the ability of foreigners to source capital at rates cheaper than New Zealanders can.

The ability for purchasers to convert the land to a high yielding production also drives the prices up . This is typically forestry which returns greater returns over a 30 year harvest cycle of a pine plantation than operating the same land as a beef / sheep operation. The higher returns from forestry push the price of the land up even if the land remains in sheep / beef production.

This tax may take the shine off forestry plantings as it would require continue deemed income taxation over the 30 year growth period. The impacts to our nations CO2 targets could be horribly impacted if forest growers had to pay tax on the value of the capital invested annually for 30 years without any income to offset it.

Has the impact to forestry and our CO2 commitments even been considered?

In regards to a rural land bubble I have no fear of that. Every time the rural sector has a major down cycle foreign investors are at the ready to purchase as much of it as they can. Marlborough vineyards are undoubtedly over 50% owned by foreign entities. Given our OCR runs significantly higher than most of the western world, foreign investment in rural sector land is a lot more affordable to offshore entities than us locals. When they can source capital at 1-2% while we might have to pay 4-6% the deck is tilted in their favour.

How I see your tax proposal is taking the FDR (Fair Dividend Rate) tax on foreign equity holdings (excluding Australia) and applying it to the general economy. FDR of 5% was decided based on the expected long tern returns of that class of asset likely to be 5% or greater. The issue was that a large number of foreign companies kiwi’s invested in did not have a policy to declare a taxable dividend and instead where happy with the capital appreciation of their share price. The investment was solely for capital gain (much like Auckland property speculators) but this was not taxable under the old system unless the investor had a history of trading stocks. The Buy and Hold long term strategy was in effectively tax free.

How this drastically differs from this proposal as there was an expectation under FDR that the capital invested (taxed at 5%) was on the long term expected to appreciate at a rate of 5% or higher. Applying an across the board flat taxation rate on capital (GST style) without any analysis on the long term expected returns of the underlying asset classes being taxed is a receipy for disaster.

With FDR it was well understood that the underlying assets where highly liquid in nature, being traded equities listed on stock exchanges around the world. There also was the understanding that generally the assets where readily divisible and a portion may be sold off to cover any tax commitments. The liquidity and divisibility aspects that apply to foreign equities do not apply to rural land holdings. A $2-$3m beef and sheep farm might sit on the market for 2-4 years before a purchaser can be found to pay the asking price. Farmers in their 60’s and 70’s will just stay working the land until they get the last pay day unless a family member has interest in taking over the land. The asset isn’t at all liquid. Additionally local council planning rules and bureaucracy drastically limit the divisibility of land holdings. You can’t simply sell off 2.5 Ha of a 100Ha farm to meet these proposed tax changes.

So a flat rate taxation of capital in the form of FDR works in New Zealand for foreign equities. The liquidity and divisibility of this particular class of capital allows taxes to be paid without creating serious cash flow issues to tax payers.

If you apply the same 5% tax on a rural sector returning -5% in a drought year you are kicking the dog while it’s already down. You CAN NOT simply apply a flat tax rate on capital year in, year out on the rural sector with causing farmers duress and hardship not only the drought years but the 2-3 years it takes to rebuild the stock numbers after having to slaughter 1/2 your stock numbers due drought. It can not work.

Then you look at the impact to the rural service sector of provincial New Zealand. Farms returning 1-4% could have their tax bill topped up to 5% taking $100m’s out of provincial New Zealand which is already struggling and giving it Auckland’s in the form off income tax breaks. These $100m’s will get taken out of all the shops and businesses and auxiliary service providers to the rural sector in provincial New Zealand.

Look at the cash flows in some of the Ministry of Primary Industries farming models around New Zealand. When a Marlborough/Canterbury Hill Country Farm only returns $138,000 before tax on a $5,000,000 farm thats a 2.76% return on capital. If you had a deemed 5% tax rate on capital this same farm suddenly has a $112,000 per year clash flow issue. There is literally no way to pay the tax bill without selling stock and reducing future profitability, selling land and reducing future profitability or increasing bank lending and reducing future profitability.

Every way you cut it farms become less efficient and Aucklanders benefit from Income Tax breaks. How is that not a direct attack on the rural sector?

Rob

Sean: Yes, I see what you’re getting at.

An overriding concern is whether simplifying the implementation dilutes the comprehensive or universal nature of the tax enough to render it ineffective. That is, whether the simplifications leave loopholes that can be exploited.

I’m thinking that the “written down book value” is actually sufficient for calculating the tax. For example, a small business buys an eftpos machine and then writes down the book value as prescribed for tax. It’s all self consistent in that case. The decreasing book value provides the basis for the “minimum taxable income” derived from that asset. If the business is able to attribute more in real income to machine that the minimum then the minimum becomes irrelevant.

I’m not sure about how the tax will be calculated when a business (or any asset) is sold for a price that exceeds its previous valuation. I assume some correction will be necessary that will be calculated in some appropriate way.

Is this tax proposal really seen as

(1) ONLY a solution to an Auckland problem?

(2) Some kind of attack of town on country?

Disturbing.

It’s puzzling to me to think of large areas of rural land where valuations are high but where the returns of farm businesses are extremely low or negative. What’s driving the high valuations? Isn’t there already an overwhelming motivation to sell up, regardless of tax proposals? The high valuations mean someone sees the possibility of high benefit from owning the land. Is the benefit “hidden” monetary benefits, capital gains, or the lifestyle?

All of the above says to me that there’s not just an Auckland house price bubble or a city house price bubble but a rural land price bubble as well.

We sure have let ourselves get into a mess.

Hi Matt
Your comment doesn’t really answer my question – spending on assets (capital expenditure) is tracked sure, but is that the value you want to tax ? Gareth is talking about taxing assets at their “value” – for property this will presumably be the rating valuation, the way property rates are currently calculated. But the rating valuation is not the capital expenditure (that is, the cost) of the property. If you’re going to tax the capital value of the business, you must have some method of ascertaining the value of the business. I’m talking about small businesses here (that is, not corporates); they’re not required to track the value of the business (and the assets in it) for tax purposes, currently, just the written down book values. This is one reason why when business owners try to sell their businesses, it can be very tricky coming up with an appropriate valuation. But under this proposed capital tax policy, this will have to be done annually, presumably. We don’t know, based on what we’ve been told so far.
As far as individuals are concerned, it may well be simple to determine the value of assets on which they will be assessed for a capital tax – but as I say, how will the value of jewellery or art work, for example, be assessed ? Again, based on what we’ve been told, we don’t know. So how can we judge whether or not this policy will be simple to administer, and effective in achieving its goals ?

Sean: I think (larger) businesses are already spending a lot of time keeping track of asset valuations for tax purposes and for annual reporting. Capital expenditure already has to be distinguished from expenses because it is not tax deductible all in the one tax year as expenses are. Valuation of IP is already a tricky issue. I think there are already tax rules about classes and thresholds of expenditure that don’t need to be considered capital expenditure for tax and accounting purposes.

For individuals, I think there will have to be well defined rules about what’s in and how little is in in defining a person’s total assets. I think it can be both simple enough and effective because most people have a small number of major assets.

You’re proposing to tax the “capital” invested in a business. So is this different to the “assets” of the business ? Because, for property, you’re proposing to tax the value of the “asset”. If its the value of the assets of the business, how do you establish what the values of the assets of the business are ? For example, the intellectual property of the business (Xero, anyone ?) Or are they written down book values ? Does this mean that every business will have to have an annual valuation of its assets (and liabilities, presumably), and will you specify the valuation methods ? Will there be a threshold level of the value of assets on which this capital tax will be assessable – for example, art works, jewellery, motor vehicles, boats and so on. And how will those assets be valued ? You’re proposing to allow deferral of payment of the tax, as I understand it. Looks like a big increase in compliance costs here, Gareth.

And, once again, you have missed the opportunity to simplify the process and capture the tax. Why IS it that you are so keen on this “deeming” idea? This time its that someone’s income will be deemed to be X if it doesn’t meet certain criteria that you (or the government of the day) have decided.

Once again, will you please consider a transaction tax? When those rich guys employ the builder they get the money from the bank (mostly) – TT is charged in the withdrawal. Then the builder takes the money and buys materials – TT on the purchases when the seller banks the money. Then they pay him for his work and he banks that, – TT again. With TT in place, the rich guys pay twice the tax because the money withdrawal is taxed as well as the rebanking. If they just employ the builder “legally” they transfer the money from their account to whoever is supplying the goods and services and pay it once.

It also gets all this moralising out of the tax system where some transactions are deem,ed (that word again) worthy, while others are not and should be hunted down (at public expense) and prosecuted/taxed/fined. KISS.

The problem you are looking to solve, capturing negatively geared property speculators who never contribute to the tax base, is a urban/city problem.

These people provide very little to the greater GDP of our country. They rent out properties & that is about it.

The rural sector with high land values & extremely low to negative incomes is fundermentially different. Farmers grow things the primary production that goes on to create further processing/jobs and most importantly tax revenue. The carpet makers, Icebreaker wool clothing, freezing workers, stevedores loading rural products on to ships creating export income for our country. Shearers, fencing contractors, contract hay & silage makers, stock agents the list goes on & on & on.

The rural sector literally creates communities. It contributes to the whole economy. But it also has huge capital tied up in underperforming land.

The farmer in your propsals is being targeted for not paying huge income tax, but he does more for our country than just being a source of tax revenue. Whoops broken tractor, better go spend money with a mechanic in town to fix it. The gorse & broom is getting away need the helicopter guy in to spray it before it gets away too much.

The negatively gears residential property speculator is a leech on society. You are correct to target them. But blanket rules that take out the rural sector who actively contribute to the broader economy is madness.

So let’s exclude the rural sector from land tax …. sorry guys can’t do that because you’ll create a subsidy that our competitors will challenge at the WTO & may even be incompatible with various Free Trade Agreements we have in place against subsidies in primary production.

I just can’t see your tax plan working without flushing the baby down the drain with the bath water.

Do not kill the rural sector simply for the sake of a bunch of property speculators not paying enough tax.

This tax will not create a fairer NZ reducing the gap between the mega rich & the poor. It will just beat up on farmers who are doing more than their their fair share at contributing to the communities they live in.

As a sheep & beef farmer on marginal hill country on the dry hills of Marlborough I would like to say something. Go fuck yourselves! Trying to solve “Auckland” & city problems with blanket capital based taxes will devistate the beef & sheep sector who are running on a 1-3% return on capital before a wage is even taken for the long hard hours worked from the primary worker/owner. Many multi-generational farms are saddled with huge debt from having to buy out non farming siblings. While some of the farms are worth millions on paper they are extremely low in profit & cashflow.

Run your numbers on MPI farm models and you will see your proposals will be the death of hill country farming.

https://www.mpi.govt.nz/document-vault/4215

Kiwis will be forced off the land by banks & foreigner multi-millionaires who can afford to pay your stupid tax will be the only people left & will buy up all our land!

A no exceptions (GST style) approach to land taxation is an uninformed, unresearched nightmare looking to ruin a sector of this country that has provided substantial benefits to the foreign balance of payments & made positive contributions to the standard of living of all New Zealanders over many generations.

But you say this land tax will not increase the total tax take, it will provide lower income taxes to offset. Now this is kick in the teeth number two. Because you are going to be pillaging the rural sector with high land values & low income values & passing the income tax breaks to urban dwellers on high wages & salaries.

Please stop this now before your ruin this country by getting a slice of power in a brexit/trump protest vote from the dissatisfied masses.

Shaun: 5℅? I think the proposed tax is more like 1-2% depending on interest rates.

TOP is definitely not at saying that family home owners are operating scams. It is saying that they are getting benefits from home ownership (equivalent to income) that are tax free at present.

The proposal is not to take more tax overall (i.e. to be revenue neutral). That doesn’t help you if your present income tax bill is low but you own significant assets. It will help lots of salary and wage earners who pay significant income tax.

I’m going to have another read of the policy before saying anything more. There’s a lot of details and implications to digest and understand.

http://www.top.org.nz/top1

https://d3n8a8pro7vhmx.cloudfront.net/garethmorgan/pages/95/attachments/original/1480976402/tax-detail.pdf?1480976402

http://www.top.org.nz/top_s_policy_to_make_new_zealand_fair_again_some_numbers

http://www.top.org.nz/tax-faq

Sometimes I wonder whether people know the meaning of the word ‘entitlement’. Like, none of us got to choose who we were born to or what sort of society we wanted to live in, at least as kids (at 26 years old I’m still mostly one at heart); we were granted it, with all its benefits and drawbacks. Human civilisation has advanced technologically and morally (we’d like to think), but when one looks at the course of human history – of all societies – and looks for a single common driver or goal that caused those civilisations to come together, it ultimately comes down to pursuit of resources. Same for every single species of animal (or organism, for that matter), which is odd… it’s almost like we ARE animals. However, we look at the world we’ve created and we know that we’re not JUST animals. We’re something more. And I do think that too.
But we still live in a world in which we treat people like animals – but worse, like caged animals. By this I mean we make the primary objective of their lives the gaining of resources for themselves or their children. I’m not saying that government (i.e. the people, in a democracy, as the definition would dictate) should provide for everyone’s needs… but I think that the better those needs can be covered, the more time people can devote to being more than animals. If instead we watch while more of New Zealander’s incomes have to be dedicated towards housing and other essentials, while more prospective first-home buyers have to compete with profit-hungry landlords & speculators, while more of our people enter an impoverished situation… we’ll end up with a society that views the people at the bottom as animals. And at some stage, as Gareth says, they’ll/we’ll start acting like it.
I used to think the world was beyond the ‘might is right’ way of thinking. But financial strength is analogous to strength in arms. In a world where (to simplify) access to all resources is concentrated into a single resource, money is might, and evidently might is still right.

I bought bare land, built my own house and have lived on my property for 26 years. Never speculated, never played the property game. My land and house are now extremely valuable through no fault of my own. I just wanted to live where I am. TOP must not equate income (of any kind) with property value. I could not afford to pay a 5% tax like that on my place let alone buy it now. My income does not reflect my property value. TOP seems to think everyone in a high value property scammed their way into it thats not my case. Unless it excludes someone like me TOP’s tax reform is unfair and TOP is about fair….. right?

Andrew: which flavour of libertarian?

https://en.m.wikipedia.org/wiki/Libertarian_socialism

https://en.m.wikipedia.org/wiki/Libertarianism

I agree we can learn from libertarian ideas.

If there are no fairness absolutes, I for one certainty think we can still figure out how to move in the general direction of fairness. Particularly so when the unfairness is seen in the comparative statistics of demographic groups.

Values are personal, yes, but not only personal.

If you’re saying that wealth (and power) are these days likely to result from a rigged system, then yes. So, let’s try to unrig it.

You could do with some libertarian friends to set you straight.
There is no such thing as a fair tax system. There is no fairness in equity. There is no such thing as a collective value system. Values are personal. Values are contextual. There is no collective mind: only a few people who happen to agree with you. That doesn’t mean you get to gang bang vulnerable women. For the same reason it doesn’t mean you get to gang bang vulnerable rich men.
If you wonder why there are few vulnerable rich men, it’s because (i) wealth is more likely these days to reflect govt favour or social prowess rather than efficacy or (ii) you have made them feel financially vulnerable.