AgResearch and Lincoln drop merger

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10577252

Plans for a merger of the nation's biggest science company, AgResearch, and Lincoln University have been downgraded to a "partnership".

"A partnership model would be preferable to a full amalgamation as it will be more cost effective and still achieve significant benefits for New Zealand," the two institutions said yesterday.

My home is my castle

On Sunday Bernard Hickey posted Ten tips to tax NZ out of dire straits in his blog at the NZ Herald. I hope his tongue was firmly in his cheek with this one, because I don't normally I don't find his views too extreme.

Much on the list can be torn apart, although I'm aware that they all represent desperately loved and defended ideologies of the far right. I'm going to take issue with one here.

5. Impose a flat tax on land, as is the case in Hong Kong. This would incentivise investment in capital and business ideas rather than land speculation. It's also much cleaner and cheaper to administer than a capital gains tax on property investment. Farmers and property owners would scream blue murder, but they have made out like bandits for decades.

Firstly, we have one of these already, although it's not strictly speaking flat. It's called 'Rates' and is paid to local government. And frankly farmers already pay much more (by virtue of the areas of their properties) for fewer services than those of us in the city.

I think I get a pretty good deal in town for my $1500/year just between roads, rubbish collection, water, sewerage disposal, without even getting into parks, libraries, public events.... My rural parents pay a lot more for .... of the above; roads I think, maybe water. And sure there's more road per head out there but there's also not much in the way of the other things.

Secondly, and following on from that, some farmers may have 'made out like bandits' (if you believe the main stream media), but I'm positive it's not the majority needed to make a blanket statement like that stick. Especially if you haven't been in dairy over the past few years it has not been all strawberries and cream. (Tangent: from the high of 70 million sheep in 1984 the NZ flock now numbers only 34 million).

And if they are, so what? Someone has to have the money to spend to drive the economy and who better, those who put in the hard hours and the sweat of their brow or the fat cats who take and sell the hard made commodities and skim off the profits?

Thirdly, he's just plain wrong about the flat tax in Hong Kong. Someone was kind enough to point it out in the Herald comments but the Hong Kong property tax is on rental income.

Ultimately though the problem with this is that it strikes deep at the concept of property ownership, which happens to be one of my personal bugbears. A man's home is his castle, except when it's actually owned by his feudal lord to whom he pays a tithe ... see the similarity to Mr Hickey's suggestion?

There is in New Zealand at least the illusion that anyone can aspire to actually own property rather than leasing it from the powers that be. It's a pretty tenuous illusion at times, with all the permissions you have to get to actually build or grow anything on the land you theoretically own. To some extent it's a price you pay for living in a modern society - but that's a different rant. This suggestion would pretty much destroy that illusion - if you want to 'own' the government's land (because it's all the government's land) you pay them for the privilege.

Now if it was actually clear what services you were paying for (as it is, relatively) with rates, it could make more sense. Like road taxes should be spent on roads first and then excess into the general fund (or out, in the case of a shortfall). Like tobacco taxes should go directly to health (actually I believe tobacco should be de-legalised, but again that's a different rant).

Income tax can go wherever it's needed, before some smart-ass asks.