No plans for capital gains tax, says Cullen

National says the Government appears to be preparing the ground to impose a capital gains tax on investment properties.

But Finance Minister Michael Cullen yesterday said the claim was "absolute nonsense".

This week Dr Cullen confirmed he had asked Treasury to consider what options were available to slow down the economy.

National finance spokesman John Key said from the noises Dr Cullen was making it was clear he "wants to pour cold water on the Kiwi love affair with home ownership".

Dr Cullen said on Tuesday he had asked the Treasury to consider available options to slow the economy. This was because lifting interest rates as the Reserve Bank had been doing was "clearly less immediately effective" than was the case five or 10 years ago.

He said there were not many options and they were not "exactly attractive".

Demand for investment property has been one of the reasons for the housing boom, which in turn has helped keep the economy boiling and driving up inflation.

Mr Key said Dr Cullen did not make such comments about having options without something in mind.