A report prepared on behalf of the Government says high wealth families pay a median effective tax rate of just 8.9%, as they earn significant income from untaxed capital gains. "I repeat again today that I have never favoured taxing the family home, either by way of capital gains or imputed rents. The report notes that capital gains are volatile, which means the effective tax rate of high-wealth families can vary from year to year. The lower return derived from the asset is a cost from the tax system that is not captured in average effective tax rates,” IRD said. It did find that effective tax rates were generally lower than statutory rates, but also that effective rates increased as the net real economic incomes of households increased.

Source: Stuff April 26, 2023 20:17 UTC