A controversial capital gains tax is being proposed in a final report out today with the money raised going to income tax cuts.
So what exactly is it?
In simple terms, as an example - say you bought a house as an investment for $500,000.
You sell it ten years later for $1,000,000, making a profit of half a million.
Now, this is where capital gains tax comes in.
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Let's say the rate is set at 33 percent. It means your profit is taxed by that much.
So, $165,000 goes to the taxman, and the government coffers.
It'll also apply to money you make when selling other assets like a business or shares.
The family home will be exempt from a capital gains tax.
(First published February 2019.)
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