Key virtually ruled out a capital gains tax at his post Cabinet press conference yesterday afternoon, listing the reasons why such taxes are a bad idea: they're not efficient, cause distortions and don't prevent property market booms anyway.

However, he is much less downbeat on other forms of property tax, such as a land tax or putting increased onus on existing provisions in the Income Tax Act aimed at property investors.

Asked about public comments from various members of the Tax Working Group indicating interest in some form of land tax, Key said he hadn't seen enough detail about those statements to comment, and he would wait to see what would come out of the working groups, final report.

And asked about boosting the existing rules in tax law relating to property investment, Key said, "let's see what the working group has to say.... I'm not going to rule that out.

"But a straight capital gains tax, no, I'm not convinced."

The Tax Working Group meets again this week, with the issue of taxation of party the main focus of this meeting.

Meanwhile the Institute of Chartered Accountants has cautioned that a capital gains tax is no magic bullet for economic stability.

The institute's tax director Craig Macalister says there is too much propensity for people to look to the tax system as the magic lever to be pulled when some behaviour in the economy needs changing.

"There are many complex factors that come into play. Using the tax system to target bubbles in the markets is fraught with danger."