Labour Unveils Capital Gains Tax on Property to Fund Free Doctor Visits

Labour has announced a capital gains tax (CGT) plan targeting property—excluding the family home and farms—to finance a new “Medicard” scheme offering three free doctor visits annually for all New Zealanders.
The caucus approved the proposal in a near-unanimous vote after months of debate over whether to pursue a wealth tax or CGT. The new 28% tax will apply only to profits from property sales, beginning July 2027, and will not be retrospective. Revenue generated will fund free GP visits for every citizen or resident through the Medicard system, integrated with existing healthcare networks.
Prime Minister Chris Hipkins had earlier ruled out both wealth and capital gains taxes before the 2023 election, but later reopened the discussion to renew Labour’s policy direction. Polls indicate public opinion remains divided, with 43% supporting a CGT on investment properties.
Critics, including Finance Minister Nicola Willis, called the plan “a terrible idea,” warning it would burden businesses and property investors. However, tax expert Craig Elliffe from the University of Otago described the proposal as “clean, simple, and fair,” saying it could steer investment toward more productive sectors and help tackle low national productivity.