She said she was unable to get consensus from all members of Cabinet – likely meaning Winston Peters would not accept the tax.
Cullen said this was absolutely what happened.
"Ardern did not rule [a CGT] out," Cullen said.
"The Government was unable to proceed because Mr Peters has ruled it out, let's be quite clear what's happened here."
He suggested Peters made the decision not to support the tax for political reasons.
"I understand the nature of politics from their perspective – when you're sitting on about 3 per cent in the polls, you've not got a lot of political capital to use up really."
Peters this afternoon downplayed NZ First's role in the Government back down, saying it was the lack of public support throughout the country that led to it.
The NZ First leader said the decision was not made until the "last few hours".
Cullen said NZ First may have been worried about going down further in the polls if they had supported a CGT.
Cullen added that he was disappointed with what happened – "but not in the least bit surprised".
"I thought it was always going to be very difficult to persuade Peters and New Zealand First to vote for any form of CGT, given their natural constituency is older, whiter than the population as a whole."
He said this demographic would have been more susceptible to a CGT than most of the population.
In fact, he said he was never really confident that the TWG's CGT recommendation would get across the line.
But the party which would be worst off because of the Government's CGT call would be National, he said.
"I think the big losers out of this were the National Party because they saw this as the horse they could ride to the election and win on.
"Basically, while I'm disappointed in New Zealand First's decision, it has shot the horse out from underneath the National Party."
He said they are in "a lot more trouble than they would have been" if the Government did about a CGT.
"They haven't got the one thing they have been campaigning on over the last six months."
Cullen was no longer the chair of the TWG – his job finished today, he said.
