What's Exempt From Labour's Capital Gains Tax

This is election policy, not current law. Labour’s capital gains tax (CGT) is a proposal for the 7 November 2026 election and would only apply if Labour is elected and legislates it. For the full mechanics of what’s in scope, see Labour’s capital gains tax explained.

Labour’s own framing is that “everything else is exempt” outside two narrow categories — residential investment property and commercial property. This article covers what that exempt list actually contains, sourced directly from Labour’s policy document and its own website.

The confirmed exempt list

Per Labour’s CGT policy PDF and policy page:

• The family home, including lifestyle blocks
• Farms
• KiwiSaver
• Shares
• Business assets — the business itself, not the property it occupies (see below)
• Inheritances and gifts
• Personal items — cars, boats, art, furniture, jewellery

The family home and lifestyle blocks

Your main home is exempt in full, and Labour’s document is specific that this extends to lifestyle blocks — a distinction that matters because lifestyle blocks sit in a grey area under some other property tax rules. For property investors weighing up a second property, this exemption is what draws the line between “your home” and “an investment” — see Labour’s CGT and property investors for what happens on the other side of that line.

Farms

Farms are exempt outright — not folded into the residential or commercial property categories that are in scope. This mirrors how farmland is already treated as an explicit exclusion under the current bright-line test, discussed in Labour’s CGT vs the bright-line test.

KiwiSaver and shares

Both are named exemptions. Growth in your KiwiSaver balance, and gains on directly held shares, would sit outside the CGT entirely under Labour’s proposal — this is a property-and-commercial-real-estate-only tax, not a tax on investment portfolios generally.

Business assets — with one carve-out

The business itself — as a going concern — is exempt. Labour’s own worked example is a laundromat business called Wash Place Limited: the value of the laundromat business is not taxed under the proposal. Only the commercial building the business operates from would be in scope, because commercial property is one of the two taxable categories.

Labour’s website separately states that small businesses selling their premises to buy a bigger one are “not taxed” — this specific claim appears on labour.org.nz’s policy page but is not repeated in the formal PDF, so it should be read as Labour’s stated position on its own site rather than a line item spelled out in the costed policy document.

Inheritances, gifts and death

An inheritance is not treated as a realisation event, so no tax is triggered at the time of death. Labour’s worked example follows a couple, Phyllis and Liam: when the first spouse dies, their share transfers to the surviving spouse tax-free; when the surviving spouse later dies and the property passes to the children or executor, there’s still no tax on that transfer. The property is then revalued at the point of transfer, and if it’s sold within six months at that revalued price, no gain — and so no tax — arises on the sale either.

Transfers to a spouse, civil union or de facto partner are also not taxable events, including transfers that happen because a relationship ends or someone dies. If the property is later sold as a taxable asset, any tax is based only on the increase in value since 1 July 2027, not from the original purchase.

Personal items

Cars, boats, furniture, art and jewellery are all explicitly exempt — the tax has no reach into personal property, only residential investment and commercial real estate.

See what’s actually taxed

If none of your assets fall outside this exempt list, the Labour capital gains tax calculator will show you a $0 result with the reason. If you do hold residential investment or commercial property, it will estimate what Labour’s proposed 28% rate could mean for you.