More futility on the tax cuts that won’t be

Parliament kicked off again today with questions to the Prime Minister about the planned reversal of the legislated tax cuts. I don’t think anything much was gained in the exchange, but Bill English made several points amongst the exchanges.

Rt Hon Bill English: So can the Prime Minister confirm that, under the Taxation (Budget Measures: Family Incomes Package) Act 2017, which is currently the law of the land, as supported by National, the Greens, and New Zealand First, a teacher on the average wage would, from 1 April 2018, pay $1,060 less in tax if the current law was to continue in place?

Rt Hon JACINDA ARDERN: I have already answered that question, but, as I continue to point out in this House, it is a hypothetical question because that law has not come into effect, and it won’t come into effect.

Rt Hon Bill English: Is the Prime Minister aware of just how many families are in a category similar to a teacher on the average wage, who would pay less tax from 1 April 2018 if the current law was allowed to continue?

Rt Hon JACINDA ARDERN: I’m glad the member raised the effect on families. As we’ve said, we will not be proceeding with fully bringing into effect the tax-cut package that he introduced, because it gives $400 million to the top 10 percent of earners when, in fact, this Government’s priorities, which are different, will see 70 percent of families with children better off—70 percent.

That’s 70% of families with children, not families without children, and not households without children.

Rt Hon Bill English: Is the Prime Minister aware that there are 1.2 million households who do not have children under the age of 18 and, in addition to that, that there are 700,000 superannuitants who would benefit from the reduction in tax that is currently on the law book in this Parliament?

Labour have been trying to divert from those demographics that will not benefit from their planned changes.

Many of them will in fact pay more tax as a percentage of their income as pay rises will increase the proportion of their income taxed at their highest (marginal) rate.

Rt Hon Bill English: Why did her Government decide that money should be taken from a teacher on the average wage and spent on what is now widely regarded as an ineffective policy of providing the first year of tertiary education free for the overwhelming number of young people, who are going to do it anyway?

Rt Hon JACINDA ARDERN: First of all, I would say that we have taken nothing away from income tax earners, because they have not received it.

That is a poor way of describing things.

I earn money, and my employer takes money away from me as PAYE tax and ACC Earner Premium, on behalf of the Government.

Under current legislation the Government would take less away from me from 1 April next year.

Under legislation planned by Ardern’s Government more tax will be taken away from me each pay than what is currently legislated.

Perhaps to emphasise her view of how income tax works Ardern repeated herself.

Rt Hon Bill English: Will the Prime Minister answer the question this time, and that is: if it’s unfair for a tax cut that might benefit members of Parliament, why is it fair to remove a tax cut for a teacher on the average wage so that my children can have a much larger subsidy to attend their first of tertiary education?

Rt Hon JACINDA ARDERN: First of all, we have removed nothing from those taxpayers.

The Government removes tax from us every pay.

Second of all, I would wager that a number of those teachers would welcome the idea of not having been burdened with student debt by making education more accessible.

And I would wager that a number of teachers would like to pay less income tax so they can pay off their student debt faster, or pay off their mortgages faster, or save more for a deposit to buy a house.

Ardern’s Government plans to take more tax away from many people than English’s government legislated for.

But it’s often futile getting straight questions and straight answers out of politicians,.

26 Comments

  1. duperez

     /  December 13, 2017

    It’s often futile getting straight questions and straight answers out of politicians all right.
    If you’re an extraordinary ordinary MP you simply refuse to answer. If you’re a bit higher up the pecking order you might find some other way around it.

    Ms Ardern doesn’t have the luxury of saying, “I was acting in my party role not as Prime Minister.” She can’t use the old Clutha trick.
    Still it’s rather funny to hear Mr English, sorry the Right Honourable Bill English say, “Will the Prime Minister answer the question this time?”

    • Kitty Catkin

       /  December 14, 2017

      Some questions cannot be publicly answered, of course.

  2. Blazer

     /  December 13, 2017

    completely childish argument from the opposition…as if you can miss something ..you never ..had.

    • Kitty Catkin

       /  December 14, 2017

      You must be the only person who doesn’t mind not having to pay less tax.

      • Blazer

         /  December 14, 2017

        don’t mind paying tax..if it goes to a good cause.

      • Gezza

         /  December 15, 2017

        I don’ mind not paying less tax if it’s spent wisely, including on infrastructure. I’ve just got back from 3 weeks up in Northland visiting Sir Alan & Possum & their spouse/partner rspectively, & I couldn’t believe the bridge we had to drive on to get to the Waitangi Treaty grounds. Huge tour buses also drive over it every day. It’s just a single-lane, asphalt-covered-plank bridge. Just ridiculous for a major tourist attraction, especially one the politicians visit every year. Still one-lane bridges all the place up that way.

        I had a great holiday though. Thanks so much Al & Possum.

        • Alan Wilkinson

           /  December 15, 2017

          Too much money spent on welfare and too little spent on infrastructure over many decades in the North. That’s where your tax money goes. More of the same coming under Jacinda.

          And Sir Gerald was a welcome visitor to our wilderness, gentle fun and nature in all its aspects.

  3. robertguyton

     /  December 14, 2017

    Over and over the Opposition repeats the tissue thin claim and still no one is convinced bar themselves. Is the word “dorky” still used?

  4. High Flying Duck

     /  December 14, 2017

    Good questions, answered badly by Jacinda. She has decided to undo a broad based tax cut and “pick winners” by doling the money out to those she deems worthy.
    Large numbers of people who have had their income eroded through bracket creep over a number of years have been stiffed by this government.
    There will be perverse effects as people on very similar incomes will be receiving very different incomes depending on circumstances.
    Even families with 2 parents on the average wage will be worse off under this Labour policy.

    • Alloytoo

       /  December 14, 2017

      And again perversely some people seem happy about it.

      • Kitty Catkin

         /  December 14, 2017

        She is using muddle thinking if she thinks that current teachers will be paying less on student loans because people in the future will be.

        • Kitty Catkin

           /  December 14, 2017

          It won’t be much of an incentive to work instead of being on the dole or the DPB.

  5. Alan Wilkinson

     /  December 14, 2017

    Bracket creep is the secretive tax grab that socialists love. Dishonesty is their middle name.

    • Blazer

       /  December 14, 2017

      well its the rights first name…tax havens ,trust devices ,all constructed by the rich parasites to avoid paying their fair..share.

      • Kitty Catkin

         /  December 14, 2017

        Would you happily pay tax that you didn’t have to pay if you could legally avoid it ?

        Or give away all your money if you suddenly became rich, so as to avoid being a rich parasite ?

        How is someone who employs as many people as Michael Hill does, or as Stephen Tindall does a parasite ? Both of those began working for someone else, had a vision and went after it-at the risk of it being a failure. People like that work incredibly hard in the beginning and reap the rewards of this hard work-and some fail through no fault of their own.

        Then there are those who sneer at the Tindalls and Hills….

        • Blazer

           /  December 14, 2017

          I didn’t even know Tindall and Hill used ..tax havens.

          • PartisanZ

             /  December 15, 2017

            Michael Hill Jeweller and Stephen Tindall’s The Warehouse are as alike as cat and dog … (which a pretty accurate respective species analogy IMHO) …

            https://en.wikipedia.org/wiki/Michael_Hill_Jeweller

            and … https://thedailyblog.co.nz/2015/08/06/the-warehouse-where-shareholders-get-a-bargain/

            Tindall has a Wiki page, of course. A very brief Wiki page. Strangely, countless websites say exactly the same things about Tindall, word-for-word!

            About general conditions at the time, here’s Chris Trotter –

            “Was it a set-up? Had the [1984 post-election] crisis been manufactured to establish the conditions for a successful bureaucratic coup? … only by unleashing a top-down revolution could their [The Reserve Bank and Treasury’s] root-and-branch restructuring of New Zealand society and economy be accomplished”

            Oh yes, if you were lucky, or ruthless, or set up to make a fortune by your friends in the Beehive, the 1980’s was a wonderful time.”

            Whether Tindall was “lucky, ruthless or set up” will forever remain a mystery. As Trotter says, “We may never know, and it is risky to speculate”. Names like Fay, Richwhite and Gibbs come to mind as well …

            One thing is certain, “New Zealand’s import substitution industries – the prime guarantors of full employment – now exposed to unbeatable competition from the world’s sweatshop economies, were devastated”

            The Warehouse and Tindall’s role in this is as undeniable as that of the favoured Merchant Bankers aka ‘Robber Barons’ …

      • Alan Wilkinson

         /  December 14, 2017

        I’m guessing you wouldn’t like paying their “fair share” either, B, and that it’s only fair so long as they pay it and you don’t?

  6. The ideological positioning will forever diverge on taxation. Do you know better how to use your money to advance and advocate for yourself and family or does Grant Robertson?

    I’m in the former group. I accept that as a society we need infrastructure, health and policing and certain other communal distribution, but I fail to accept that the levels of taxation we are subject to are anything other than grand theft and that our own money is wasted while mass brainwashing occurs.

    • Alan Wilkinson

       /  December 15, 2017

      Not only wasted but cynically exploited for political and personal gain, trav.

      • Guvvmint Ministerial aspiration is top of any Socialist’s personal pay grade AW. The rest are journalists and teachers.

        • Blazer

           /  December 15, 2017

          And the finance sector is the preferred vocation for aspiring Capitalist swine who wish to partake in rapacious theft and fraud,inflicting misery wherever they…set up their swindle.

    • Blazer

       /  December 15, 2017

      I’m sure you have ..trusts and a smart accountant.