Tax competition is a marvelous liberalizing force. Every time a taxpayer leaves a high-tax jurisdiction for a low-tax jurisdiction, bad policy is punished and good policy is rewarded.
New Zealand’s richest woman is the latest tax expatriate, as reported by The Press:
Reclusive Kathmandu founder Jan Cameron has moved to Tasmania after spending more than 30 years in Christchurch, where she built a $275 million business fortune. Starting with a small shop in Linwood, Cameron turned her outdoor-clothing and equipment venture into one of the country’s best-known brands, with outlets in New Zealand, Australia and Britain.
The Press understands Cameron had looked at staying in New Zealand after selling Kathmandu last year and planned to donate a portion of her annual income from her investments to charities. But under the New Zealand tax regime, all the money she gave away over an $1800 threshold would be taxed, so she opted to move to Australia, where there is no limit.
…PricewaterhouseCoopers tax specialist John Shewan said he was not surprised by Cameron’s decision. “It does underline how careful we need to be if we want to retain high-net-worth individuals,” he said. “We need to have a tax-friendly environment. Sadly, we don’t have that at the moment.”
Shewan said Cameron would pay no tax on her overseas investments under new Australian tax rules. ”Australia has stolen a march on us in terms of attracting high-net-worth individuals,” he said.