A paper, presented by tax academicians Leonard Burman and David White, called for extending the capital gain tax to investment property and houses, as people unnecessarily buy neighboring land to avail tax exemptions.

Mr Burman said: "I think New Zealand should have a capital gains tax. Right now you have a significant amount of income that's free from tax - most of it is earned by very wealthy individuals it's a great deal for them."

The visiting US property expert, Mr. Burman, who also worked for former American President Ronald Reagan and is one of the renowned experts on capital gains taxes, advised political parties to support capital gain tax in New Zealand; otherwise the wealthy and powerful would continue to avail benefits.

Mr. White, who assisted the tax program at the Treasury in the 1980s, asked for the need to initiate a wider tax reform package like GST, implemented by the then Labour government to bring necessary changes in sales and income tax.

The country's tax system is being discussed at the Tax Working Group, jointly established by the government and Victoria University. The group is expected to submit its report in December.