Won’t wealth taxes discourage saving?

The vast majority of savers in New Zealand will not be affected by a wealth tax.

Current proposals anticipate a threshold of between $2 and $10 million net wealth (that means after subtracting any debt), excluding the family home and Māori collective assets. Even for those who save above this threshold, a wealth tax set at 1-2% of net wealth will not discourage further saving because most wealth is retained.

However, for the ultra-wealthy, a wealth tax will discourage the hoarding of wealth in unproductive assets, like property or offshore investments.