[Weekly Wrap] Maybe shares have better tax treatment than property?
One of the stories I found most interesting this week was contained in Morningstar's new report on tax rates in KiwiSaver funds.
Friday, September 21st 2012, 12:31PM
As the researcher says tax ratios aren't the sort of information which you would use to pick a KiwiSaver fund, but they are sort of interesting. More interesting was the revelation how tax-efficient Australasian shares are compared to all other asset classes including cash.
We have details in this story, but it does make you wonder about two things.
Firstly will the super-tax efficiency of this asset class spawn a new range of products, like we have seen in the past. Think AUTs in the early 2000s and WINZ.
Secondly, it makes the argument that residental property enjoys bigger tax breaks than other asset classes interesting.
The other story which I think will have a significant impact are the long-awaited moves to allow people to move their superannuation schemes between Australia and New Zealand. For us we could see a lot of money coming into KiwiSaver.
When this was first mooted a number of providers worked on schemes to help advisers here. I guess they have to dust off the plans again now.
Looking at the news it seems to be a big KiwiSaver week as we also had calls (again) for the scheme to be made complusory. This time the calls came from Australia.
Not many weeks go past without some sort of pronouncement, or two from the FMA. So far this week the most topcial one was its decision trustee companies and the notable omission of Perpetual Trust. Rumour has it that there is a lot happening behind the scenes and it would be no surprise to see some sort of deal engineered where the trust business gets sold to someone like the Public Trust. I guess that would make it just Perpetual, and there is a little irony in that name.
The other rumour floating around is what will happen to its advisory business which it had been working on so hard to build up. Could it be sold to another South Island-based organisation as suggested? Watch this space.
On matters economic the discussion has been about things like Monetary Policy, macro-prudential tools and the dollar. Our take on the Reserve Bank's new Policy Target Agreements is here.
Meanwhile Westpac has taken an aggressive pricinig position on long-term home loans. Have a read of this piece to see what it has done and where it now sits compared to other lenders.
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