The National Party leader Simon Bridges says new regulations on rental properties and a capital gains tax will drive up tenants' costs and increase state house waiting lists.
The government's working group released its proposals on Thursday which included taxing land, farms and most shares and business assets - including the bach - but excluding the family home.
Mr Bridges has told Morning Report a capital gains tax would hit middle New Zealand, not the wealthy and repeated what he said last week that it was an attack on the Kiwi way of life.
"What the Kiwi way of life is is a recognition that New Zealanders aspire, they understand that people who work hard, who save, who invest, who take risks deserve the fruits of their labour and there is nothing fair about a capital gains tax that fundamentally gets in the way of that."
Mr Bridges, who owns four properties, said Prime Minister Jacinda Ardern and Deputy Prime Minister Winston Peters owned significant homes in Auckland, which would be exempt from the tax because they were first homes.
He said "ridiculous exemptions" existed such as mansions in expensive suburbs in Auckland and Wellington while $350,000 investment properties in the likes of Whanganui and the West Coast would be hit by the tax.
"It makes no sense," Mr Bridges said.
He said the wealthy would always be fine, while the middle section of New Zealand would be affected.
"There is nothing fair about 2.9 million KiwiSavers getting pinged, small business owners going out every day in the hope of a nest egg at the end of it getting pinged, and the exemptions around the residential property stuff create massive unfairnesses."
"What we've got here is a tax on a tax. People pay their income tax, they save, they invest in KiwiSaver, they do all these things and then we're going to ping them again."
He said Tax Working Group chairperson Michael Cullen had made it clear that the capital gains tax would do nothing to ease problems with housing affordability.
"What will [make a difference] is decent planning reform that gets to the bottom of the issue of land supply and freeing up housing. It's not going to be this, this is entirely unfair to New Zealanders."
He disagreed with Westpac chief economist Dominick Stephens that the tax would lead to higher living standards.
The economists at the other top four banks did not share Mr Stephens' view either, he said.
Last week, Finance Minister Grant Robertson told Morning Report Mr Bridges needed to turn "the hyperbole volume down a little bit".
"I think the Kiwi way of life is about giving people a fair go, I think it's about making sure that everyone is treated fairly ... that's what New Zealanders look for, that's why we set the working group up.
"What I would say to Simon Bridges and to the National Party is 'let's have a reasoned debate about this'.
"Because most other countries in the world have regimes like this and there are issues of basic fairness that need to be debated.
New standards for rentals 'well-intentioned'
He said the new minimum standards for heating, insulation, ventilation and drainage in residential rental properties, announced yesterday by Housing Minister Phil Twyford, were "well-intentioned."
"The worry is you put it with the residential tenancy changes the government has made, you put it with the capital gains tax; all of these things drive up costs on landlords, they drive up rents and actually they hurt supply.
"And we see rents are $40 more today than they were when this government first took office, that's a huge increase. You've got for the first time ever 10,000 people waiting for a state house waiting list. If that's a definition of the success of Jacinda Ardern I don't think most New Zealanders would agree."