UK Labour tax expert says CGT may push house prices up

Stuff reports:

A tax expert appointed as an adviser by former British prime minister Tony Blair expects New Zealand’s Tax Working Group will recommend a broad-based capital gains tax, only for Prime Minister Jacinda Ardern to reject the idea.

Former PwC global tax and governance leader Christopher Wales served as former British chancellor Gordon Brown’s principal adviser on tax after being appointed by Blair to a six-strong team of economic advisers to the British Treasury. 

A capital gains tax would probably mean fewer houses and higher house prices, he said.

If you tax something, you tend to reduce the supply of it. Tax labour more, and less workis done. Tax capital more and people invest less.