tax

Categories under tax

Johnny Key and the magic $500 million

Written By: - Date published: 4:11 pm, June 25th, 2008 - 12 comments

Whenever John Key is asked to explain how he will fund some new spending or his still secret tax cuts, he says ‘we’ll cut waste/rein in spending’ and the only example he ever gives is ‘we’ll cap the core public service at 36,000′. This, he claims, will save ‘$500 million over 3 years’ or $166 […]

ToryAid: Wastewatch (3)

Written By: - Date published: 11:59 am, June 24th, 2008 - 68 comments

In response to the UMR poll that shows 60% of voters would not want tax cuts at the expense of public services, Bill English says “under any tax plans we might have government spending will continue to increase* but [we need] more effective public services in tougher times” Notice, they are already preparing the ground […]

PSA broadens tax debate

Written By: - Date published: 11:58 am, June 24th, 2008 - 21 comments

It’s good to see the PSA broadening the public debate on tax cuts with a UMR poll showing the majority of Kiwis don’t want bigger tax cuts if they come at the expense of public services. To summarise: 71% of New Zealanders would prefer to keep taxes at current levels than have higher user charges […]

Act now to protect workers’ wages

Written By: - Date published: 11:40 am, June 19th, 2008 - 55 comments

              Times are going to get harder for workers in the next few years. Unemployment is set to rise to 4.5-6% (still well under 1990s levels). The wages of those who keep their jobs won’t rise as fast. At the same time, prices are rising faster, particularly petrol. What […]

Slippery John’s “after-tax incomes” line

Written By: - Date published: 10:29 am, June 18th, 2008 - 33 comments

You’ll have noticed that Key only ever talks about increasing ‘after-tax incomes’. Even when he’s asked about wages for government employees, like doctors, he responds that National would increase their after-tax incomes with tax cuts, not by increasing their wages. But anybody can see that cutting taxes is only a short-term way to slightly increase […]

Facing up to peak oil

Written By: - Date published: 1:25 pm, June 16th, 2008 - 38 comments

The Government’s independent report on petrol prices is bit of a sop to be the public, really. The world oil price is driving petrol prices; any efficiencies that could be gained in New Zealand would be small and would not change the upward trend. Nor is a Fuel Watch website like Australia’s going to do […]

Key’s slippery promises on waste

Written By: - Date published: 3:27 pm, June 14th, 2008 - 50 comments

National has staked it all on delivering bigger tax cuts than Labour. To remain credible, they need to deliver $20 a week on average more than Labour. That’s $3 billion a year. The operating surplus is gone, so where will the money come from? John Key has been repeatedly referencing the fact that the government […]

Treating the voters like children

Written By: - Date published: 9:45 am, June 13th, 2008 - 30 comments

Keith Holyoake used to say “tell the people, trust the people”; be honest about the benefits, trade-offs, and costs of policies and trust the people to judge you in an adult manner. Central to Brand Key, however, is playing to voters’ baser desires, especially greed, and fomenting juvenile beliefs, including that it is possible to have ones cake and eat it. For […]

Centre party? Yeah, right

Written By: - Date published: 3:14 pm, June 11th, 2008 - 31 comments

Why is it that UnitedFuture is branded a centre party? We all know they’re socially right wing, in bed with the Christian fundamentalists, and the tax plan Dunne announced on the weekend proves they’re far-right economically too. They would blow the Budget with $4.6 billion cuts  (no mention of where the money would come from and no-one […]

Mythbusting: The govt gets rich off high petrol prices

Written By: - Date published: 9:49 am, June 9th, 2008 - 95 comments

We regularly hear calls (not backed by any major party, including National) for the taxes on petrol to be lowered or removed because the prices are so high. After all, every time the price goes up, the government gets more revenue, doesn’t it? No, it doesn’t. Tax on petrol has two parts. There are four levies […]

ToryAid: The Standard resurrects Wastewatch

Written By: - Date published: 1:35 pm, May 27th, 2008 - 66 comments

Remember wastewatch.co.nz? It’s National’s site listing all the ‘government waste’. From six years of Labour government it managed to find a grand total of $1 billion in waste (0.32% of Government spending or a 10 cent a week tax cut) and most of that wasn’t ‘waste’ it included the entire $400 million for the new […]

Back in the real world

Written By: - Date published: 6:41 am, May 27th, 2008 - 40 comments

Let’s have another look at our friend, the distribution of income graph. The red circle is what most people earn. The blue circle is where you would think most people earn given the commentariat’s fixation with the 39% bracket. No prizes for guessing which circle editors and opinion writers fall into, eh? You’ll also note […]

Kremlinology: Nats’ tax plans

Written By: - Date published: 3:24 pm, May 26th, 2008 - 11 comments

National is still refusing to give us any detail on its tax cut plan, indicating it doesn’t have one. But let’s do a bit of Kremlinology to work out what we might expect from them when they eventually get their act together. The size of Labour’s tax cuts has spooked National. Key’s speech in reply […]

Even Granny’s patience can wear thin

Written By: - Date published: 9:47 am, May 26th, 2008 - 42 comments

With a loving smack that would have brought a smile to Bob McCoskrie’s face, the Herald‘s editorial today rebukes John Key in the strongest terms it can. Now that the Budget is behind us, the National Party has less excuse for indecision on most of the important economic issues facing the country at the coming […]

Cumulative Effect

Written By: - Date published: 1:51 pm, May 23rd, 2008 - 60 comments

The Press (Budget Doesn’t Impress Family) looks at the effect of the tax cuts on an average family with a combined income of $78,000 and two kids under 12 . They will have $42 more a week from tax cuts and boosted Working for Families tax credits come October 1. That’s like getting paid for […]

National’s cruel hoax

Written By: - Date published: 10:10 am, May 23rd, 2008 - 52 comments

Well the budget is out and across the country the public are looking at their tax cuts and asking “is that it?” and this is at a time that economists are very nervous about the inflationary impact of such a large package of cuts and anything bigger means cutting services or significantly increasing borrowing. The […]

Tax cut graphs and full calculator

Written By: - Date published: 9:30 pm, May 22nd, 2008 - 15 comments

Here are graphs of the portion of income going on tax and the portion of reduction in tax for Kiwis under the Budget’s cuts, with the population in each $10,000 bracket. As you can see, the biggest percent reductions go to the bulk of the population. And everyone is paying at least 10% less tax […]

Tax cut calculator

Written By: - Date published: 5:27 pm, May 22nd, 2008 - 7 comments

As much as I despair to see our political discourse descend into a bidding war on taxes, it’s worth looking at Infometrics’ online online tax cut calculator here. Just plug in your income and it’ll tell you your new effective tax rate and how much you’ll get in your pocket from October 1 through to […]

Budget 2008: Tax cuts

Written By: - Date published: 2:55 pm, May 22nd, 2008 - 27 comments

Labour has announced a three year tax cut package worth $10.6 billion. Here’s a table showing the changes: Current 15.00% 21.00% 33.00% 39.00% Up to $9,500.00 $38,000.00 $60,000.00 $60 K New 12.50% 21.00% 33.00% 39.00% 01/10/08 $14,000.00 $40,000.00 $70,000.00 $70K plus 01/04/10 $17,500.00 $40,000.00 $75,000.00 $75K plus 01/04/11 $20,000.00 $42,500.00 $80,000.00 $80K plus What does […]

National: we’ll borrow for tax cuts for the rich

Written By: - Date published: 12:30 pm, May 19th, 2008 - 77 comments

Discovering National’s policy is a bit like the old art of Kremlinology, when Western intelligence agencies would attempt to discover the inner workings of Soviet politics by looking at who stood next to whom in pictures, and what hand politburo members carried their briefcases in. The latest subtle signs from National regarding its tax policy […]

ACT: tax cuts for the rich, please

Written By: - Date published: 3:34 pm, May 13th, 2008 - 139 comments

Rodney Hide is calling for the Budget’s tax cuts to take the form of raising the thresholds to account for inflation since 1999, removing of the 39 cent bracket, and a $10,000 tax-free bracket. What would ACT’s tax cuts entail for New Zealanders? Hide says the average cut would be $50 a week, so we […]

Tax cut speculation

Written By: - Date published: 2:39 pm, May 9th, 2008 - 55 comments

Now that Michael Cullen has ruled out a tax-free bracket but promised that everyone will benefit from Labour’s tax-cut package, what cuts will he give? The simplest option would be to cut the bottom tax rate, which would deliver a tax cut for everyone. As a percentage of income the tax cut would be largest […]

Cullen rules out tax-free bracket, GST cut

Written By: - Date published: 11:24 am, May 8th, 2008 - 20 comments

It’s disappointing that Michael Cullen has ruled out both a tax-free bracket and a GST cut in his tax cut package to be announced at the Budget (not least of all because it means he clearly isn’t taking policy advice from The Standard). His reasoning is odd on both points. The tax-free bracket is rejected […]

The 40 cent tax cut

Written By: - Date published: 1:37 pm, May 6th, 2008 - 17 comments

National and some of the more wacky commentators are complaining that the $655 million used by the Government to buy back the rail stock should have been used, instead, to fund tax cuts. Now, there’s a crucial difference between a tax cut and a one-off capital purchase. And it’s that you only pay once for […]

Would Key scrap GST on food?

Written By: - Date published: 3:12 pm, May 5th, 2008 - 5 comments

With hints that regional fuel tax could be put on the “go slow” list, along with parts of the emissions trading scheme, it seems like we shouldn’t take any policy on taxes for granted. For example, there’s a belief that National and Labour have consensus on not removing GST on food. A couple of comments […]

Put it on the kids’ tab

Written By: - Date published: 12:00 pm, April 29th, 2008 - 6 comments

Some may have noted an odd series of questions in Parliament and press releases from Bill English around government borrowing over the last month. The questions purposely conflated the idea of maintaining current debt levels with increasing debt. We noted this at the time and Tane correctly picked the strategy: First, sow confusion about debt […]

7 reasons why cutting GST on food will not help

Written By: - Date published: 9:00 am, April 29th, 2008 - 30 comments

Scrapping GST is a classic, populist issue that sounds delicious in times of high food prices but at closer inspection – it doesn’t taste good at all and isn’t the best way to help those struggling to buy food. The cost of food and fuel has dominated the media over the long weekend and there […]

Dunne: feathering his own nest

Written By: - Date published: 12:40 pm, April 28th, 2008 - 12 comments

Peter Dunne is once again touting his plans to introduce income splitting. It’s a policy aimed at helping out the wealthy. New Zealand Institute of Economic Research senior economist Patrick Nolan tells us that “80% of the tax gains of income-splitting would go to the top 20% of taxpayers”. Dunne was reportedly “not bothered” by […]

I’ve got a solution, what’s the problem?

Written By: - Date published: 9:44 am, April 23rd, 2008 - 38 comments

The junior doctors’ strike is a difficult issue. On the one hand, these are highly valuable workers whom we can’t afford to lose overseas and they do work long hours in difficult conditions. On the other hand, the pay rise they want would cost $50 million and is well above what other medical professionals have […]

National’s tax cut dilemma

Written By: - Date published: 10:45 am, March 28th, 2008 - 14 comments

If National are so keen to cut taxes and so critical of the Government for not doing so earlier, why are they being so tight-lipped about how they would cut taxes and even the size of their cuts? Because the Budget has them trapped. Labour plans to announce its tax cuts in the Budget, probably […]

The 50 cent tax cut

Written By: - Date published: 9:33 am, March 26th, 2008 - 16 comments

This morning on Breakfast, John Key repeated his line that capping the size of the core public service (that includes planning staff for health, prison guards, and the human rights commission) at current levels would ‘save $500 million over three years that could be used for more ‘frontline’ staff and tax-cuts’. Leaving aside that it’s not […]

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