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Bright-line test unfair to taxpayers, says NZ Law Society

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NZ Lawyer | 25 Sep 2015, 10:51 a.m. Agree 0
New concerns about the bright-line test, specifically its effects on ordinary taxpayers, have been raised by the New Zealand Law Society
  • Grant Diggle | 25 Sep 2015, 01:32 p.m. Agree 0
    Typical knee jerk Government Treasury RB reaction. The existing law has provision to catch speculators always has. All it ever needed was enforcement by IRD who have failed spectacularly over decades to catch property traders and speculators.
    Now innocent tax payers will suffer because of Government Ministers lack of understanding of the law as it already stands.
  • SP McKenzie | 25 Sep 2015, 01:47 p.m. Agree 0
    I am not sure why this is unfair. If people are buiyng multiple properties then they are presumably making a decision that it will result in some financial benefit for themselves. The new rules are well publicised and I am sure that lawyers can advise on the implciations of them so peopel can take those into account. The possbility of having to sell within two years can then be factored into purchasing (risk / retunr) decisions. Ultimately - it is a question of buisness risk and if you don't want to take the risk associated with a a potential return (greater than the rtuine form depositing your cash at the the bank) then the answer is don't buy. Furthermore, if peope, are atxed then they are only going be to be taxed on theior profit - if they don;t make a profit then teher won;t be any tax - which surely means anyone selling within two years will be getting more cash back than they put in and are therefore likely to be better off. Furtehrmore, purcashesr can priotect against many unforseen events with insurance. Yes, it may be better to overhaul the rules completely in an idelal world but the world id not ideal to say that the bright line test is unfair is, perhaps, overstating the case. If you want unfair then perhaps you should talk to the firts home buyer shut out of the AUckland market.
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