Capital gains tax has been a Green policy since 2003 and the party is sending out many press statements and video links on the subject while Labour is left floundering.
Yesterday, Green co-leader Russel Norman issued another statement on capital gains tax, saying it was a critical component of rebalancing the economy that no amount of tinkering by Finance Minister Bill English would fix. It would help shift investment out of property speculation and into the productive sector.
Labour MPs are looking smug, confident the tax policy being released next week will be a game changer in the false election campaign currently being waged.
Former Labour finance minister Michael Cullen was a staunch opponent of a capital gains tax.
Green co-leader Metiria Turei told the Otago Daily Times that a capital gains tax had been a Green Party policy since 2003 and had again been part of a major speech she gave earlier last year.
A capital gains tax would restore the right incentives for investment in the economy. That was why the OECD, Treasury, the IMF and the Savings Working Group supported a tax on capital gains, she said.
The capital gains tax policy was the second time in recent months that Labour had adopted a Green policy. The Greens also proposed raising the minimum wage to $15 an hour five or six years ago before the policy was adopted by Labour.
Asked how she felt about Labour taking ownership of Green policy, Mrs Turei said that, in one way, it was good because it meant the Greens were leading the political agenda on economics.
"It cements our position as a political force on taxation and social issues."
However, Labour had a chance during its last nine years in government to introduce both a capital gains tax and increase the minimum wage to $15. It failed to do either, she said.
The delay in introducing both policies had meant a huge cost to the country.
"It's not good enough to have the policies in opposition. You have to carry them out in government," she said.
The Green capital gains tax policy is straightforward, according to the party website:
• Support the introduction of a comprehensive capital gains tax on inflation-adjusted capital gains at the time the capital gains are realised.
• Support a blanket exemption for the family home from any capital gains tax.
• Support treating taxable real capital gains as income for tax rate purposes and investigate mechanisms to allow the income from capital gains to be spread over several years for New Zealand residents.
A party spokesman said the Greens wanted to win the debate before going into detail.
The policy is gaining traction, with manufacturers, exporters and academics joining the call for the introduction of a capital gains tax.
The New Zealand Manufacturers and Exporters Association said the eradication of the capital gains tax harbour would help to lift productive investment.
Chief executive John Walley said a more balanced tax system would see investment flow to the most intrinsically profitable areas of the economy, rather than those that were tax advantaged.
"With the tax system as it is now, investment in assets is favoured. Assets provide few jobs and no tax revenue to the Government. "The same investment in the productive economy provides jobs, export earnings or import substitution, higher incomes and more government revenue; plus the hope of a balanced current account," he said.
AUT University law academics said the "average" New Zealander would not be affected by a capital gains tax because the majority of New Zealanders did not have investment properties.
"Those that do, do so to reduce their annual income tax bill in any case. For example, they are high-salary and -wage earners who recoup PAYE by utilising losses from investment property."
The recent introduction of the LTC (look-through company) would do little to remedy the problem, the academics - Chris Ohms, Ranjana Gupta, Dennis Moodley and Katherine Ritchie - said.
