NZ Prime Minister Christopher Luxon calls capital gains tax a ‘wrecking ball’

During the Australia‑New Zealand leaders’ meeting in Noosa, New Zealand Prime Minister Christopher Luxon told Australian Prime Minister Anthony Albanese that introducing a capital gains tax (CGT) would be a “wrecking ball” for the New Zealand economy. Luxon said his remarks reflected the long‑running domestic debate in New Zealand and were not intended as criticism of Australia’s tax policy.

The comment followed a recent appeal by New Zealand Finance Minister Nicola Willis, who encouraged Australian entrepreneurs to consider New Zealand’s “very pro‑growth, anti‑red‑tape” environment that lacks a CGT. Albanese’s government is set to overhaul its own CGT rules, ending a 50 % discount for assets held over a year and moving to an inflation‑indexed system with a minimum 30 % effective rate from July next year.

The tax issue has become a political fault line ahead of New Zealand’s November 7 election, with the Labour Party pushing for a broader CGT while Luxon’s centre‑right coalition rules it out. The Noosa dialogue also covered trans‑Tasman business ties, supply‑chain challenges and technology change, and Luxon promoted New Zealand infrastructure firms for contracts related to the 2032 Brisbane Olympics. Albanese highlighted the depth of people‑to‑people links, noting about 638,000 New Zealanders live in Australia and roughly 90,000 Australians reside in New Zealand.