The five measures of fairness for a CGT

The Herald reports:

Any capital gains tax recommended by the Tax Working Group will be judged for fairness by the Taxpayers Union against five measures, including exempting inflationary gains and it being tax neutral overall. …

The union released a report today setting out its five measures of fairness:
• No valuation day – it favours grandfathering assets into a tax regime upon their first sale after the tax takes effect rather than the tax applying to all assets assessed at a certain value from day one.
• Exempting inflation – it says the tax should not apply to the inflationary part of the capital gain on sale, and only to the real capital gain.
• Revenue neutral – any additional revenue from a capital gains tax to fund tax cuts in other areas.
• Roll-over relief – Allowing for the deferral of capital gains tax on inherited assets until the first realised sale after the inheritance.
• Discounted rate of CGT – it favours a rate much lower rate than as suggested in the interim report, at the taxpayer’s highest tax rate.
Jordan Williams said if the Government put forward a reasonable proposal focused on fairness and steady reform, the Taxpayer’s Union would accept a tax shift.
“In contrast, if the Working Group process was just an excuse for aggressive tax hikes, we’ll fight it to the end.”

It will be interesting to see both what the Working Group recommends, and also what the Government decides to try and do.