These wealthy individuals have such a low tax rate because so much of their income (about 80%) is capital gains – money made from selling assets – and that is barely taxed. Only 17% of their income is conventionally taxable income like wages and salaries. So despite being worth an average of NZ$276m ($168m; £135m) each, and typically earning $8m a year, these families pay an average of about $640,000 each in tax – less than 10% of their income.
One objection is that the income of the 311 wealthiest families includes unrealised capital gains: that is, increases in the value of assets that have not yet been sold. For some, this is not “income”.
However, it is an increase in wealth that can be borrowed against, and will eventually turn into conventional income once sold.
Yes, indeedy, the toads are lying once again. Fuckers.