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Battle lines drawn as capital gains tax finds support

Labour's capital gains tax is attracting public support, a new poll indicates.

More New Zealanders support than oppose a capital gains tax, a policy which is dividing the country by income, occupation—and unsurprisingly, property ownership.

Phil GoffLabour leader Phil Goff

The first nationwide poll conducted since Labour's policy announcement finds 40.9 percent support the party’s capital gains tax proposal with 34.1 percent in opposition. A further 17.9 percent are neutral and 7.1 percent don’t know.

Horizon Research says the policy appears to have consolidated traditional support for Labour, but is not triggering a significant support rise. Labour’s party vote support is up 0.9 percent on its May result, while National is up 2.2 percent. National is still enjoying stronger support than Labour, and is 10.2 percent ahead.

There was strong support for a CGT among Labour, Green, and New Zealand First voters and strong opposition to it among National, Act and United Future voters.

Those polled were told: “Labour proposes a 15 percent CGT, with exemptions for family homes and some holiday homes and small businesses. It says this will make the tax system fairer and raise revenue to make the first $5000 of income tax free for everyone, take GST off some essential food items, and avoid the need to sell down state assets longer term to repay Government debt.

“National argues a capital gains tax is complicated, may slow economic recovery and the country does not need another tax.”

The HorizonPoll surveyed 1201 people last week and has a maximum margin of error of ± 2.8 percent.

Battle lines drawn

Gender: 46.8 percent of men support it and 37.7 percent oppose it. Among women, the split is 35.2 percent/ 30.5 percent.

Personal income: The CGT's strongest supporters earn less than $20,000 a year (45 percent), between $20,001 and $30,000 (44.6 percent), and $70,001 and $100,000 a year (44.4 percent).

Among those earning $30,001 and $50,000: 36.6 percent support it, 21.5 percent are neutral and 32.4 percent oppose it. Among those earning $50,001 to $70,000: 40.4 percent oppose it, 16.9 percent are neutral and 36.6 percent support it.

The country’s highest earners are strongly opposed to the tax. Among those on incomes between $100,001 and $150,000, 56.5 percent oppose (13 percent are neutral, 33.7 percent support it). Some 65.2 percent of those earning $200,000 or more oppose it (34.8 percent are neutral and none support).

Age: Strongest supporters for the CGT by age are those aged 55 to 64 (46.2 percent), over 65s (46 percent) and 18-to-24 year-olds (44.9 percent). Support is at 35.8 percent among those aged 35 to 44 (40 percent oppose). Among 45 to 54 year-olds support is also at 35.8 percent, but opposition at 35.1 percent (21.4 percent are neutral).

Occupation: 64.2 percent of the country’s business managers and executives oppose the tax (33.7 percent support). Among business proprietors and self-employed 48.8 percent oppose, 35.8 percent are neutral and 15.3 percent support. Highest opposition is from farm owners and managers (69.7 percent, with 16.2 percent in support and 14 percent neutral).

However, among professionals and senior Government officials support is 42.5 percent to 28.6 percent opposed.

Labour is enjoying strong policy support among students (54.6 percent), technical, mechanical and skilled workers (50.9 percent), teachers, nurses, police and other trained service workers (44.6 percent), and retired superannuitants (54.6 percent).

Homeowners: Among those who own their own homes or rental properties (with or without mortgages) 43.1 percent oppose the tax policy, 40.6 percent support and 14.4 percent are neutral.

Ethnicity: The policy draws more support than opposition from European/Pakehas (40.3 percent/33.4 percent), Maori (46.6 percent/ 22.2 percent), Indians (32.8 percent/ 21.9 percent) and Pacific Islanders (43.9 percent/ 8.4 percent).

However, among Asians 40 percent are neutral, 33.4 percent oppose and 24.5 percent support.

Party voters: People who voted National, Act and United Future in the 2008 general election oppose the tax policy (58.8 percent, 77 percent and 54.4 percent respectively).

However, the policy attracts support from 2008 voters for Labour (67 percent), Greens (70.6 percent), New Zealand First (52.9 percent) and Maori Party (65.5 percent) and those who supported other parties (56.6 percent).

Among the group of electors who chose not to vote in 2008 (some 187,000 people), 43.2 percent support a CGT, 17.2 percent are neutral and 24.9 percent opposed.