Capital gains tax recommendations: What you need to know

The coalition government's Tax Working Group is recommending a broad extension of taxing capital gains. Here's what you need to know.

The group, chaired by Sir Michael Cullen, has recommended the following:

• Tax the capital gain on sale of land, shares, business assets, intangible assets such as intellectual property.
• Tax to be imposed when the asset is sold, and levied at the seller's marginal tax rate.
• The tax would NOT apply to the family home, and personal assets such as cars, paintings, jewellery, and household appliances.
• A holiday home WOULD be taxed on sale.
• No change to GST and no exemptions for certain types of products, such as food and drink.
• The capital gain on shares in companies would be taxed but in some circumstances capital losses would also be able to be offset against other income.
• The capital gain on the sale of a business would be taxed, including the goodwill.
• No changes to income tax rates, but a recommendation to raise the income threshold for low and middle income groups.
• Environmental taxes: changes to the emissions trading scheme to be more like a carbon tax.
• Dirty taxes on solid waste to reduce volumes to landfills.
• Taxes on water pollution and water extraction.
• Taxation of fertiliser use. Consider congestion charges to tackle traffic issues.
• The government's full response, including any planned new taxes, is expected in April.
• The intention is to have legislation passed ahead of next year's election, but changes won't come in until 1 July, 2020.
• National would have the opportunity to repeal the legislation if it wins the election.