'Buying NZ Property – Download the free sample readings!

NZ presents some of the most alluring property in the Western World; particularly given the greater easy of residency, the low cost of property, and the liveability of the country. In addition, there is no capital gains tax, transfer taxes, VAT/GST or wealth taxes in NZ, so rest assured that NZ property is tax-effective! Learn more now!

New Zealand Property Report 2010 - Download the table of contents or buy this 180-page report at our online store for just $US19.95.


Sunday, September 19, 2010

Cheap living and avoiding tax in NZ

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The NZ tax system greatly relies on indirect taxes. There are a number of things you can do in order to reduce costs:
1. Buy your clothes overseas - particularly if you are an expat who spends casual time in NZ
2. Grow your own fruit and vegetables and trade the balance with neighbours. NZ has good rainfall and soils, so its very easy to grow food and flowers. You can also save money by composting the household vegetable matter for your garden fertiliser.
3. Catch your own fish, shoot your own deer, pig or rabbit. You need a licence and the approval of landowners, but it makes more sense than paying $25-40/kg for fish in the store.
4. Ride a bike rather than drive a car. NZ petrol taxes are very high at 58c a litre. Fortunately you don't really need to use a car very often, there is nothing to do in most towns. A car makes sense in NZ though because of unreliable weather. It rains a lot.
5. Retain your offshore passive income - as an immigrant for 4 years before you have to pay tax on it. This is a particularly lucrative strategy if the NZ dollar is weak against your home currency.
6. Insulate your body, not the home: Where warm clothes rather than pay high gas and electricity prices space heating homes with poor insulation. Better to just wear a very warm jacket. NZ has the highest energy prices in the world. It is a particular sham considering it has the lowest generating cost for electricity in the world. Failing that consider using an open fire as the wood is cheaper than paying $1/day for gas connection, on top of the $1/day you already pay for electricity, whether you are living there or on holidays, 1 person or 10. This is clearly an incentive to share your home.
7. Buy most products online from TradeMe, online specialist stores in NZ or abroad; whether second hand or new. Local stores have limited range and there is a lack of competition.
8. Buy an existing house rather than building: Old houses in NZ are far cheaper to buy than building a new one. Labour is overpriced and the industry is over-regulated, and unfair pricing terms for house builders and renovators means you will pay too much for materials. Its a scam that results in builders pocketing a profit on building materials through the major warehouse chains, and you subsidising their 3-day working week lifestyle.
9. Online entertainment makes more sense than buying your music and movies from a store. The same can be said for reading materials.
10. Outside activities can be expensive, but this need not be the case. Anything which you can do in a social setting is preferred. My philosophy group costs me just $2/week, Toastmasters $70/year, tennis $70 per 6 months. Fishing is $100 for a year licence I think, and walking in the local gardens and at the beach is free.

It is apparent that the same path to tax reduction is the same path to reducing your carbon footprint. Should you be concerned about either? Only if you are grasping for money or air. But some people take pride in their ability to survive independently. The reality however is that labour specialisation is not a 'sin', but rather a very productive and meaningful way for people to relate to each other. Trade is based on the mutual respect of each others contribution. i.e. Value for value. Compare that with the grudging annual tradition of exchanging unwanted Xmas presents, or the passing off of presents you don't want, or the resentment felt by some having to race through crowded shops to please indifferent souls. Is it all worth it? No. Just do what is natural and you will be far happier. An economy structured on the basis of some arbitrary government policy is destined to make you unhappy.

Check out how much tax New Zealanders pay on petrol - 58c in the litre - that's about one-third of the final retail cost.

None of these suggestions is going to greatly contribute to the NZ economy. I would however argue that any (and every) country that considers you a slave to the interests of those who need you, ought to treat you with more respect. The unconditional extortion of wealth from those who possess it is surely the reason why social values are in their current state. Such is the nature of altruism. Unconditional value judgements = non-accountability.

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'Buying NZ Property – Download the free sample readings!

NZ presents some of the most alluring property in the Western World; particularly given the greater easy of residency, the low cost of property, and the liveability of the country. In addition, there is no capital gains tax, transfer taxes, VAT/GST or wealth taxes in NZ, so rest assured that NZ property is tax-effective! Learn more now!

New Zealand Property Report 2010 - Download the table of contents or buy this 180-page report at our online store for just $US19.95.


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