New Zealand has long stood out among comparable economies not for what it taxes, but for what it doesn’t.

Perhaps nowhere is that more apparent than in its lack of a comprehensive capital gains tax: a measure used by counterparts including Australia, Canada, the United States and the United Kingdom.

In basic terms, this tax applies when an asset is sold for more than it was purchased for. The gain is treated as income and taxed accordingly.

While its absence has helped New Zealand to maintain a relatively simple tax system, it increasingly raises concerns about fairness, economic balance and the sustainability of government revenue.

For decades, that debate has largely been a political dead end, with successive governments concluding the electoral risks outweigh the policy benefits.

For at least one mainstream party, that now appears to be changing. After years of ruling one out under Jacinda Ardern, centre-left Labour recently proposed to introduce a targeted capital gains tax to fund free healthcare such as GP visits.

Parties to the right of Labour remain opposed to a capital gains tax – National argues it would add complexity and stifle economic growth – while those to its left generally support some form of broader taxation of wealth or capital.

In any case, the coming elections mean voters are likely to hear renewed debate about the tax. This is........

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