Tax rejig looked at to encourage short term investment
Monday 12 July 2004
Finance Minister Michael Cullen says a rejig of tax laws may encourage investors to switch funds from long term investments like property into short term investment like the high-tech sector.
By The LandlordDr Cullen today welcomed the release of an issues paper inviting consultation on how to improve the tax rules on depreciation of assets.
Dr Cullen said he was concerned that current economic depreciation rates did not reflect " the reality of economic life in a time of rapidly advancing technology".
"If they do not, they may have a disincentive effect on the level of capital investment and may be biased in favour of long-term investments such as rental housing and against short-term investments such as high tech machinery."
He said it was important that investment decisions were not made for tax purposes.
Read More - Opens in a new window
Commenting is closed
Housing confidence has been dealt a hefty blow by the Covid-19 crisis with house price expectations plummeting to new lows.
Periods of house price decline are rare and "short-lived", says economist Tony Alexander, amid forecasts of a drop of 10%-15% this year.
Tales of strife and problems abound in the commercial property world these days, but the impact of the Covid-19 pandemic has not been as devastating for all commercial players.
Mortgage lending fell to its lowest level on record last month as the property market ground to a halt during the Covid-19 lockdown.