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Green Party rocks their new Guaranteed Minimum Income policy

Written By: - Date published: 7:05 am, June 29th, 2020 - 263 comments
Categories: ACC, benefits, disability, greens, welfare - Tags: , , ,

The Green Party’s first major election announcement is a beautifully conceived social security package based in the concepts of manaakitanga and compassion. It insists on giving people income security and treating them well. It’s fully costed, and financed by taxing some of the assets and income of wealthy people.

In her livestreamed speech yesterday (starts at 14m), Marama Davidson led with how we stepped up, collectively, and helped those in need with our Covid response. She then pointed out that we have had people in similar need for a very long time and it’s time to do something about that.

When someone reaches out, our first response should be to help, not to interrogate them or demand that they prove their desperation. Because when a family member turns up at the door, you don’t ask for receipts or question why they are there. You put the kettle on, give them a kai and show them manaaki. It does not matter why they need help. All that counts is that we are all supported.

The gist of the policy,

Here’s how our Poverty Action Plan works for all of us:

A Guaranteed Minimum Income of $325 per week for students and people out of work, no matter what.

A Universal Child Benefit for kids under three of $100 per week.

A simplified Family Support Credit of $190 per week for the first child and $120 per week for subsequent children to replace the Working for Families tax credits with a higher abatement threshold and lower abatement rate.

Additional support for single parents through a $110 per week top-up.

Reforming ACC to become the Agency for Comprehensive Care, creating equitable social support for everyone with a work-impairing health condition or disability, with a minimum payment of 80% of the full time minimum wage.

Changes to abatement and relationship rules so people can earn more from paid work before their income support entitlements are reduced.

A 1% wealth tax for those with a net-worth over $1 million.

And two new top income tax brackets for a more progressive tax system which redistributes wealth.

There is also additional support for disabled people, including morphing the old Sickness Benefit into the Supported Living Payment at the new initial rate of 60% of full time net minimum wage (around $390/wk).

So many good things here. The reframing into a GMI rather than a UBI means we get the necessary welfare bolted on. We don’t need a universality that gives money to everyone at the expense of those most in need, we need guaranteed minimum income security for those who truly need it when they need it. We also need sufficient income for those that cannot work.

Gone are the married/de facto rates that have long penalised couples. The ACC changes have been a long time coming, to settle inequity issues in disability from accident vs health. I’m focussed on the disability side of welfare, but it looks like there is much that is good specifically for children and parents. I expect more worker-specific policy in a later announcement, the GMI offers important support to part time workers in particular as well as the ACC reform providing extended sick leave to all workers.

One of the biggest challenges I see is how this policy will hold up in post-election coalition negotiations. Obviously if NZ First is involved it will get trashed (Peters is already being all hand wavy about taxing rich folk). Even with just Labour it’s hard to see if Labour will manage the ideological shift away from welfare as a necessary evil that can only be solved by jobs.

The other big challenge is how to reform the cultures of WINZ/MSD, ACC and the MoH so that those departments are capable of delivering such a policy in practice and philosophy. That mending is a big job and I don’t hold a lot of inherent trust that such mending would automatically follow from legislative and policy change. The Greens’ document talks about training, but Sepuloni has largely failed to make headway on this kind of cultural in her three years and has sided at critical times with Bennett-era management against the needs of beneficiaries.

I see this directional change working if someone like Davidson was heading it, someone with the understanding of manaakitanga and the commitment to embedding it more fully. Which inevitably requires enough party votes for the Greens that they can bring the MSD portfolio to negotiations post-election.

photo via Newsroom

There’s political savvy in this package and presentation. The Greens just reappropriated three years of Ardern’s kindness rhetoric and did three things. One is they funded it for everyone that needs it. No more empty promises or ‘just fuck off and wait‘ subtext for disabled people and others that can’t work. In the Covid world we’re all in this together.

The other is that they’re saying increased income is absolutely necessary but it’s not sufficient, we also need our government departments to treat people fairly and well. Everyone knows by now how much WINZ sucks, it’s well past time to sort that out.

Thirdly, they’ve made another big jump left like Turei did in 2017, which lays down the challenge for Labour to reposition itself, and opens the discussion publicly about how to solve welfare in meaningful, values-based, beyond neoliberalism ways.

It’s wonderful move from the Greens. Some of the shortcomings I see:

  • will the GMI adequately create an ease of access and lowering of bureaucracy that is meant to come from universality?
  • There’s no mention that I can see of Accommodation and other supplementary benefits which technically enable welfare to be needs-based for those with higher costs of living (I assume they stay in place, but it’s an obvious omission).
  • The abatement rate is high, although it doesn’t kick in until $165 of earnings instead of $100. There needs to be some discussion of how that might play out in relation to the GMI rate, minimum wage, and poverty drivers like housing costs.

Can’t wait to see more detail and analysis over the next few days. There’s already a move in the debate away from the manaaki aspects to the tax funded aspects (with much discussion about whether National’s response is incompetence or lies). I hope that the cultural and social intelligence embedded in this policy doesn’t get lost in the bickering, and that the left doesn’t let the right define the debate solely in terms of money. This is a bold policy with much in it that the left values, let’s keep our focus on that. We still have the task of convincing parts of the electorate that welfare values are sound and desirable.

Finally, always, thank-you Metiria. I still see what you did and how you got us here. You were right, New Zealand at the time was wrong, but we will get there in the end. Green Party, you did really good on this, again.

We can support the Greens’ policy petition here.

The Greens’ announcement page is here.

Full Poverty Action Plan/Ahi mai Ahi atu policy document (PDF)

WINZ benefit rates for comparison.

Some analysis of costings from Henry Cooke at Stuff.

263 comments on “Green Party rocks their new Guaranteed Minimum Income policy ”

  1. Dennis Frank 1

    I just watched Marama respond to John Campbell's questions about the policy on One's breakfast show, and she did well in describing it in simple language that would have got it across to most kiwis no problem.

    Even the question about the difference between GMI & UBI was handled adeptly – giving money to those who don't need it is a design flaw that has been eliminated, and will win support right across the political spectrum.

    Taxing wealth rather than income is an interesting move. Genuinely leftist, too. And at 1% hardly a problem for the wealthy. No reason centrists would be alienated either. I don't see any obvious downside.

    • It's 2% for 'wealth' over $2m.

      Those who need to keep revaluing their property and businesses may see it as a bit of a problem. Also those who have assets without having a lot of cash to pay annual tax.

      A change like this would likely have a significant effect on how people manage their finances and assets, what they are prepared ton invest in.

      It's likely to be popular with people who would be given more money taken from wealthy people, but it's fairness is debatable. As are the chances of it being able to happen.

      It is all subject to:

      • The Greens being re-elected back into Parliament
      • Coalition negotiations with Labour (Grant Robertson said they would have their own welfare/tax policy)
      • Veto of NZ First if they are also part of the next government
      • A “detailed policy development process”
      • A decision by Cabinet to proceed with whatever comes out of the process.
      • Legislation being passed in Parliament.
      • Incognito 1.1.1

        That’s a positive tick from you then, Pete? I mean, in the absence of any substantial criticism it looks like a very good policy to campaign on, don’t you think?

        • Pete George 1.1.1.1

          Quite an assumption.

          I think it's a very risky policy to campaign on for the Greens after the Metiria experience last campaign, leading their campaign with radical social policy.

          Risky for productivity taxing those most likely to be investing in business and jobs, while providing reasons or incentive for people not to work as much or at all.

          Also risky framing as only affecting 6% of people. If an older couple have over $1m assets and one of them dies, the other may suddenly be saddled with significant ongoing tax liability, or if they defer it as it seems they may be able to that has implications for the wider family/beneficiaries. It can look like a death tax.

          I haven't seem whether valuation of wealth is total current wealth, or just wealth accumulated since the start date of the scheme. I think that CGT had issues with this. Is it fair to suddenly tax someone for the wealth they have accumlulated over the past 50 years?

          Risky for Labour too, as they will no doubt get bundled in with 'Labour+Greens raising tax' attacks.

          Seems like Ardern has doubts (and/or sees risks):

          Prime Minister and Labour Party leader Jacinda Ardern told Morning Report that they would be bringing out their own policy ahead of the elections.

          She said the Greens' policy made some "heroic assumptions".

          "It's notoriously difficult to make assumptions about revenue but I think there are some fairly heroic assumptions in that policy."

          Asked whether she would support a wealth tax in principle, she said: "This is not my policy, we will have our own and I imagine it will look very different to that one."

          https://www.rnz.co.nz/news/political/420066/paul-goldsmith-admits-to-blunder-in-criticism-of-green-party-s-pledge

          Smart tactic to get a bunch of criticism heaped on Goldsmith, but that will likely quickly fade while 'more Labour+Green tax' won't.

          • Tricledrown 1.1.1.1.1

            P G a tip.The Greens said they can work with National,Todd Muller hasn't ruled that out.

            • weka 1.1.1.1.1.1

              no they haven't said that at all. Please see my mod note below and acknowledge you have understood. In premod until that happens.

          • Incognito 1.1.1.1.2

            Thanks Pete. It wasn’t an assumption but a question 😉

            I think you have a few details wrong or missing. Anyway, I would not frame it as “risky” but as “bold, brave, and progressive”.

            I’m not interested in Ardern’s “doubts” but in your opinion. I note that her comments were non-committal, either way, emotive, and evasive. I fully expect Labour’s policy to be very different from the Green Party’s one and designed to appeal to and appease middle New Zealand rather than taking the bull by the horns.

            In my view, the Green Party has set the bar for discussion and campaigning on the major issue of inequality-poverty.

            • Pete George 1.1.1.1.2.1

              And National are already busy on Facebook (and I presume other social media) with:

              National won't increase your taxes. Labour-Greens will.

              Labour-Greens will put new taxes on your house, rental property, shares, bonds, business assets and art.

              Source: Green Party "Poverty Action Plan" page 12

              National won't increase your taxes. Labour-Greens will.

              Posted by New Zealand National Party on Sunday, 28 June 2020

              That is misleading with a lot of detail left out, but no worse that Greens leaving out detail here with no links to the detail:

              https://www.greens.org.nz/support_our_poverty_action_plan

              I doubt there will be much debate, it will be mostly politics. Coalition deals are never done in a campaign. This is likely to force Labour into campaigning against the Green policy. And may expose Labour's lacklustre addressing of inequality-poverty this term.

              If Greens really wanted a decent discussion on "the major issue of inequality-poverty" they would have floated this last year. Running this now is just electioneering. It may win them some votes but that's most likely to be at the expense of Labour support.

              • weka

                "but no worse that Greens leaving out detail here with no links to the detail:"

                Lol. Pete, at the top of that page are two tabs: Policy and News. Both contain detail on the GP policy. Your link is to a petition.

                But that is completely different to what National are doing. Nat are directly telling people lies. Most people, even most Nat voters, aren't millionaires and won't be affected by the asset tax. Greens say 7% of NZers will be affected (and I'm guessing most of them in non-harmful ways).

              • weka

                Shame on the Greens for running an election campaign in election year.

                • Incognito

                  It is reverse pork barreling at its finest. What is the threshold for income tax again? Oh yes, the paperboy tax, thank you Sir John. In contrast, this Net Excess Wealth Tax (or Excess Wealth & Worth if you’re a National voter) has a threshold of $1,000,000.00.

      • That_guy 1.1.2

        A couple could outright own 2m in property and twenty cars and boats and pay nothing. One person outright owns 1.1m in assets, which nobody else has any claim to (spouse, business partner) and can't pay $1000 pa in taxes? Even in this situation they could defer and just treat is as a capital gains tax to be paid on sale.

        • Matthew Whitehead 1.1.2.1

          Yep. And the examples in the policy also make clear it's intended to allow people to defer if for instance they have a low-income year until higher-income years, too. (The example given is of a $1,300,000 net asset level each for a couple that runs a farm but has a less profitable year) So in practice it's actually been thought through very well and shouldn't be a problem. We have no comprehensive wealth taxes in New Zealand, so this would be a very good move, and would discourage non-productive asset speculation because you would NEED to be sure of a more than 1-2% return once you're past the asset threshold.

          • Andrew 1.1.2.1.1

            When combined with low interest levels will a policy such as this encourage people away from saving/paying down mortgages?

            If interest rates are low, and there is an additional tax if that debt is paid down, surely it incentivises spending over saving, which could make our countries low levels of retirement savings even worse? Combined with an aging workforce surely we would want people to be saving and paying down debt into retirement?

            • Matthew Whitehead 1.1.2.1.1.1

              I mean, your interest levels would need to be sub-2% for it to ever be worth delaying paying down a mortgage, surely? More it might incentivize you on the margins to spend on normal household assets that depreciate that are exempt, such as a new car.

              Saving towards retirement is definitely a good thing. But it's not unreasonable that those who do very well and already have their savings sorted to pay a share towards our tax priorities, as this sort of spending will likely also boost corporate returns in New Zealand and make the investments more profitable, anyway. If your personal share of assets is over $1m, you've probably saved as much as you need to, and it's not unreasonable to make you think about whether your assets that aren't for personal use are getting you a return over 1% or 2%. (And also whether you really want or need to have personal assets over $1m, in some cases. I have a family member who has probably given away enough income to stay under that threshold)

              • Climaction

                you raise an interesting point. could it be offset against tax losses on depreciation?

        • Koreen 1.1.2.2

          1% of $1,000,000 is $10,000 not $1000. 2% of $2,000,000 is $40,000. This utterly stupid policy is nothing short of Communism.

          • weka 1.1.2.2.1

            The tax is on asset worth above $1m, not the whole amount. Please read the actual policy.

          • UncookedSelachimorpha 1.1.2.2.2

            " This utterly stupid policy is nothing short of Communism "

            You don't know what Communism is, then. A dictionary could help you.

          • SPC 1.1.2.2.3

            So you think communism is being applied in many OECD nations atm? .

      • Grafton Gully 1.1.3

        You could be right about the not having cash to pay the 2%. That's $40,000 + pa on top of income tax. I'll just keep working part time if it comes in and accept the drop in savings. Monitor what the recipients of the tax money do with it and invest my reduced savings accordingly, maybe adjust existing holdings, convert capital growth to income and think of new ways to spend it.

        • Craig H 1.1.3.1

          Only on wealth of $22 million… The tax is on net wealth above $2 million.

          • Incognito 1.1.3.1.1

            surprise

          • Craig H 1.1.3.1.2

            Sorry, maths fail last night. To be paying $40,000 wealth tax, an individual must have wealth of $3.5 million. Still high enough that I'm not concerned.

  2. Andre 2

    I'm not impressed.

    High abatement rates are just fucking stupid. It goes against helping people trying to lift themselves off the bottom rung by taking away a lot of the benefit of trying to do so. So why bother. Then, if the high abatement rate reduces the numbers of people available and willing to be flexible about work hours (because they get to keep relatively little of what they have earned), then it doesn't help small businesses trying to get started, either.

    I'm also unimpressed with the wealth tax as proposed. Structuring a tax so that it becomes liable regardless of whether there's underlying cash-flow just feels really unjust and punitive when it hits. No, a glib assurance that it can be deferred doesn't help.

    Cullen's Foreign Investment Fund tax is structured that way, and while I honestly don't get bothered about contributing a cut to the government out of cash flow (including paying capital gains tax), it really really fucking grates when the government comes along and forces me to somehow cough up cash to them because I happen to own something of nominal value. Particular when you're forced to pay tax on something that has actually lost value during the relevant time period.

    • RedBaronCV 2.1

      A free fire no tax zone for the first $x thousand of income and compensatory higher tax rates at higher income brackets helps the abatement problem. If there is no abatement then someone earning $15k from a low paid job winds up paying more tax than some one with a mix of benefit and earnings of the same amount.

      The wealth tax cuts in at a pretty low level as $1m covers a pretty large number of houses in NZ and almost by default winds up being a tax on granny after granpa has died added to the 100% tax rate paid on assets over the threshold should granny be unlucky enough to have to go into care. Plus would it encourage overseas owners of property to structure a loan against a property owned here to massage net worth. Maybe non tax residents don’t get any loan offsets? Is it on worldwide assets?

      • froggleblocks 2.1.1

        Or just do a UBI with a flat tax rate.

        • Andre 2.1.1.1

          Bingo.

          • weka 2.1.1.1.1

            Come up with a workable policy and we'll discuss it. I've not seen one and I've been looking.

            • mikesh 2.1.1.1.1.1

              A flat tax + UBI tax system is probably more "workable" than the current tax system.

        • Tricledrown 2.1.1.2

          UBI is very expensive the flat tax would have to be high so would GST at20% a capital gains tax on all sales ie second hand goods,art, cars etc.

          It would be fair but not popular their are to many not paying taxes on houses,art work,farms,collectors items rare cars etc.It would not go down well.

      • SPC 2.1.2

        It has to be debt free asset wealth over $1M.

        Pretty large numbers – certainly under 10%.

        And some of that has unpaid debt mortgage, so barely 5%, if that.

        • RedBaronCV 2.1.2.1

          No – as I have said elsewhere it is potentially going to hit all main center home owners who have owned for 10 years plus because prices prior to that were a lot lower so mortgages were smaller and have been trimmed back. I've found recent data for the number of owner occupied – it's actually around 1 million not the 700,000 out of date figure I had originally used. A third have been freeholded and there will be another bunch with a relatively small mortgage or where it has been used for another investment. Whichever way you cut it – it's a lot more than 50,000 people

          I was checking out another site to see if they had better data. One comment caught my eye " Is this potentially avoiding hard decisions in other areas". Maybe we need to look a lot harder at the number of people living here or coming back who are welfare tourists.

          • SPC 2.1.2.1.1

            The average is well under $M in Wellington, Christichurch and Dunedin.

            Most of the property involved – my guess under 100,000 nationwide, would attract an amount of wealth tax lower than the annual increase in their rates.

    • That_guy 2.2

      "No, a glib assurance that it can be deferred doesn't help."

      Why does this not help? This effectively converts the policy into a capital gains tax for asset-rich but income-poor situations. Which is quite helpful. Are there really many classes of assets that are not increasing in value by at least 1% pa?

      • Andre 2.2.1

        It doesn't help because being debt-free is of huge psychological importance to many people. Particularly those of diminished earning capacity. Deferring a tax is the same as creating and adding to a debt, which then weighs on the debtor's mind.

        Whereas a capital gains tax only has effect at the moment the asset is converted into into a financial instrument – ie it is sold and converted to cash in hand. It's not an ongoing ever-present burden like the proposed wealth tax.

        • Matthew Whitehead 2.2.1.1

          "ever-present burden"

          Not really, if you don't want to pay a wealth tax you can always give your assets/their sale proceeds over $1m per person to a charity and rely on income instead for ongoing costs rather than your assets. Done. Burden gone.

          We tried a capital gains tax last time. That's clearly a non-starter until Ardern is no longer PM, so it's time to explore other wealth tax options, as we urgently need one that discourages unproductive investment. And the idea that deferrment to sale is any different to a CGT is… quite silly. Yes, being debt-free removes some financial stress. But if you have well over $1m in assets, your financial stress is very unlikely to be about subsistence but rather maintaining a particular lifestyle.

          • Andre 2.2.1.1.1

            As someone that has paid substantial capital gains taxes very recently, and regularly pays taxes structured in a very similar manner to the Green's proposed tax (Cullen's FIF tax), I find your apparent refusal to even consider points raised and further toss in careless smart-ass ideas like ‘just give it away, problem solved’ just add to my negative first impressions of the proposal.

            This is something that could cost the Greens my vote, and I doubt I'm alone on this. Considering the demographics where Greens draw a lot of their support.

            That Ardern has ruled out a capital gains tax, which really is a much better solution, isn't a argument against the Greens still including it in their policy wants. Putting up a crap alternative that also has a bunch of undesireable unintended downsides (well, presumably unintended unless there is an explicit desire to stick it to the modestly well-off pricks) to try to achieve roughly the same outcome strikes me as a really dumb approach to the problem.

            • Matthew Whitehead 2.2.1.1.1.1

              What's the downside to deferral other than "I don't like being in debt?"

              I prefer a CGT too, but there are urgent social and economic problems caused by lack of capital or wealth taxes. What do you actually need from the policy that it doesn't provide? What's your actual concern? Because deferment is a pretty common way to achieve the flexibility of having a wealth tax while still being fair to those who are income-poor at a particular time despite being asset-rich.

              • Andre

                Deferral is a crap idea because it is an undefined burden – who knows how large a cumulative deferred tax debt may grow to be? And that deferred tax debt may be incurred and grow on an asset that is in fact decreasing in value.

                I also think you really haven't a clue how big a factor not being in debt really is by how easily you dismiss it. I've seen it in family and friends, that needed to turn to reverse mortgages. And the relief and change in general outlook on life in one of those cases when a windfall enabled a reverse mortgage to be cleared, even though by any objective assessment the debt was really quite small.

                In general, basing taxes on estimated values is an ill-advised thing to do. Those estimates are subject to manipulation, and add significant administrative burden. Charging rates based on property values just barely works, because rates are directly linked to services received, and property is sorta-kinda amenable to automated regular revaluation.

                Whereas capital gains taxes are based on hard actual values – the selling price less original cost basis and interim capital additions. Levied at the time the gains are actually realised. That makes CGT the appropriate thing to continue to fight for, not to try to bring something else that's deeply flawed that sorta-kinda achieves a similar result but inflicts a lot of collateral damage on the way.

                • Matthew Whitehead

                  It's certainly undefined for people who are reliant on capital assets for income such as owner-operator farmers, who might need some sort of carve out, but for individuals near the end of their life thinking about retirement options, it might actually be pretty definable what the limits on deferred wealth tax actually would be.

                  I have intimate personal experience with what debt or just insufficient income looks like. Approaching that from a position of "my high personal assets might put me into temporary debt while my income catches up" is a problem I would quite frankly love to have right now. It requires some assessment as to whether the asset is worth more than the level of tax it incurs, but that's not an unreasonable thing to ask of literal millionaires.

                  I agree that estimated values are tricky. I would prefer realized sale profits too. I think changing to a CGT after implementing a wealth tax or other capital/land taxes would be much more practical way of advancing progress towards one right now, or if the wealth tax proposal makes people realise that a CGT is better and prefer it instead, even better. I think the Green CGT at the 2017 was a great policy, but it was hindered by extremely confused "support" from Labour that muddied the waters too much to make it practical in a political sense.

                  But we need to do something that addresses the tax situation on local, medium-term (ie. outside of the bright line) property speculation now that overseas investment is banned, and floating a policy that hasn't been explicitly ruled out by the senior coalition partner right now is a necessity. It is a political reality that for at least the next three years, if not six or even nine, campaigning on a CGT is going to be viewed by Labour as if we'd slapped their faces. I don't like it, but it's the political corner that they have painted us all into by their ineffective and ill-considered half-advocacy for the policy.

                  • Andre

                    If Labour would end up feeling like continued Greens push for a CGT would feel like a slap in the face – good. They fkn need it. All that needed to be said when they couldn't get it through was that a member of the coalition opposed it. That Ardern went on to rule it out for her time as PM was just self-inflicted unforced stupidity. And a reminder that Greens have principles beyond immediate political expediency would be a good thing too – which this proposal lacks as it panders to the error Labour made in ruling out CGT

                • Tricledrown

                  Andre NSW had to payout $650 million in the early 1990's on capital losses .CGT tax needs a lot of thought before its workable.loopholes etc.

                  To be widely accepted those who can't avoid taxes ie the majority need an equivalent reduction in taxes to the amount raised from those who don't pay any taxes.

              • mikesh

                Capital gains taxes are essentially wealth (or capital) taxes since they come about as a result of the sale of an asset which is a component of wealth. Also, there is an element of unfairness about CGTs if one is not taxing all wealth (or capital).

            • bwaghorn 2.2.1.1.1.2

              Yip if the greens get 10% and are labours only option for government then the greens can force a cgt.

              I still think it should be on all properties and share bit set at 3% or something like that .make it simple to administer and unavoidable.

        • Dennis Frank 2.2.1.2

          Actually, that's a profound point. I spent a large part of my life aspiring to be a mortagage-free home-owner, and the psychological lift when I finally got there was huge. Anyway, the response elicited from the PM by Duncan Garner reassured him that the Greens policy is a dead duck.

          To the extent that the neoliberals controlling Labour will resist anything socialist, he'll be right. So we await Labour's tax policy to see how they will campaign to fake being progressive…

          • weka 2.2.1.2.1

            Worst case scenario here is that the GP get locked out of Cabinet again but still shift the overton window on welfare and poverty (again) because of how they campaign, and then they're free to keep working on welfare outside of any Ministerial positions Labour allows them.

            That's not insignificant.

            Best case scenario is NZF out of parliament and the Greens back to their 14 MPs and Labour utterly dependent upon them to form govt. That's largely on left wing voters who voted Labour in 2017.

            • The Al1en 2.2.1.2.1.1

              Well if some of those who left the greens for labour in 2017 head back for the more left policy, then they may have a chance of hitting 10% again.

              What will be clear, and settled once and for all, with a policy of $350pw dole, is those missing million voters who won't get of their arses to vote for it, and those ultras who claim they won't vote lesser of two evils, probably won't ever no matter what's on the table for them.

              • weka

                yep and yep. Although I think the missing million don't vote for all sorts of reasons.

                • The Al1en

                  Sure, and not all of them would be poor and on a benefit, but those that are, and those 'not left enough to vote for' types, it's a bloody good put up or shut up argument.

            • Climaction 2.2.1.2.1.2

              whereas if the greens went with national, there is a strong possibility of getting this policy enabled. It makes economic sense in rebalancing the tax take, from a purely rational point of view.

              Why generate great policy if the net effect is to just be content with "shifting the overton window" and never getting it enacted.

              Labour are too scared of winston as they can take the greens for granted, so winston isn't scared of the greens. which has the effect of shifting the overall overton window right.

              winning isn't everything though right?

              • weka

                Snort. If you think National would enact this policy I've got a bridge to sell you.

                The Greens won't support National into government this year, because the policy gaps are way too wide. That decision has already been made. You can read about some of it elsewhere in the thread.

                • Climaction

                  Stupid is as stupid does I guess. It’s not a cool thing to have your support taken for granted under MMP.
                  nz1 being a case in point. $3b pgf and numerous scuttling opportunities to look like they’re in charge vs a small change to the rma

                  pretty sure the Greens won more policy concessions in opposition under the last national government than they’ve won under this labour greens nz1 government

        • weka 2.2.1.3

          Given a CGT can't be put in place while Ardern is PM, I don't get the objection here. If someone has a house valued at $1,500,000, mortgage free, and no income earning assets, then they would have a tax of $5000/yr. The number of people for whom that would be prohibitive must be small, and they can defer that payment for 20 years and pay $100000 on that property if it sells at that point.

          Am I missing something? The psychological effect of debt I understand, but I don't see that as outweighing the psychological effect of poverty, esp the kind of long term poverty we are seeing now.

          I don't know if they still do this but MSD/WINZ used to put a caveat on people's mortgages, when beneficiaries needed a loan to get essential repairs and maintenance done. That's people on low incomes, no assets, and usually having low value properties. The state still does this to pay for elderly care. There are all sorts of problems with this more serious than the GP proposal, so I'm not getting why this would be a deal breaker.

          • weka 2.2.1.3.1

            btw, I don't like the deferred payment thing either. But I see the solution to that as finding a solution to that rather than tossing out the whole policy.

            Maybe there is a hardship grant for low income people. Afaik, current WINZ policy means that the home one lives in is not counted against the benefit asset test, so someone owning a $1.5m home could be on the dole and eligible for hardship grants.

          • Andre 2.2.1.3.2

            This proposal probably doesn't have a chance of becoming reality while Ardern is PM either. So if you're going to put out proposals that simply aren't ever going to become reality, at least make the proposal one that works reasonably well that actually aligns with what is done elsewhere, rather than inventing a deeply flawed attempted workaround that no other jurisdiction is stupid enough to use (and given how deeply stupid various polities are around the world, that's saying something).

            Current loopholes and stupidities in MSD and WINZ policies that might act to mitigate some of the problems in the proposal aren't an argument for the proposal. Particularly when the widely used alternative, capital gains taxes, doesn't suffer from those problems that need to be mitigated.

            • weka 2.2.1.3.2.1

              but we can't have a CGT so I'm not going to count that in the argument.

              Your comment reasserts that you think the Greens' asset tax policy is stupid, that it's not used anywhere else, but it doesn't explain that assertion. Consequently it doesn't address what I raised.

              • Andre

                Read my other comments in this thread for why I think this Greens proposal is stupid.

                As for other jurisdictions, this proposal is a wealth tax. Wikipedia lists jurisdictions with some form of wealth tax. None of them are similar, although if you've never had the experience of being subject to a wealth tax they may appear similar. There's good reasons beyond neoliberalism why wealth taxes are on the decline around the world – they're a pain in the ass way beyond any positive effects on revenue and reducing inequality they may have.

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

                • KJT

                  Wealth taxes are disappearing around the world for the simple reason that the wealthy, who are able to buy the Government they want, are opposed to them. There was no other reason to remove inheritance taxes, to name just one NZ example.

            • The Al1en 2.2.1.3.2.2

              In the run up to an election, parties put out policy they think will attract voters, not what they think a coalition partner will sign off on.

              If the greens get a massive buy in and, for examples sake, got 25% or 26% then it would for sure be put to the house and pass into law.
              The reality may be different, but it’s all to play for at this stage.

              • Andre

                How many voters do you think this will attract?

                How many voters in leafy suburbs do you think this will put off when they start thinking "sheeit, they want to charge mum tax to live in her own home???"

                • The Al1en

                  How many voters do you think this will attract?

                  That question isn't the one I replied to. I replied to your point about proposals that simply aren't ever going to become reality, when in fact at this stage in the election cycle, we all only have only guesses and reckons.

                  How many voters in leafy suburbs do you think this will put off when they start thinking "sheeit, they want to charge mum tax to live in her own home???"

                  Hopefully less than the policy attracts, especially those leafy former earners who’ve lost jobs because of covid and have run out of the 8 week $585 freebie and now managing on $250, but again, parties don't put out manifestos for the benefit of the others, so until the voters decide we just don't know.

                  If the polls look like shit because of it nearer the election, then you can safely call it a dog and a vote loser that's ruined the prospect of a labour led government, but until then, you just don't get to make definitive statements without coming across as a bit irrational and ill informed.

                  • weka

                    I'd love to see some analysis of how many people in NZ own assets over $1m, and how the policy might play out. I'd be surprised if the Greens hadn't thought about this, lol.

                    Lefties running scare lines about mum being charged to live in her own home surprises me, but only mildly. The Panel this afternoon had blah blah there are better ways, but no-one's actually putting up the policy ideas.

                    • The Al1en

                      Like the low and middle income earners who vote tory because the ultra rich might get taxed more. Like it negatively affects them in so many ways 🙄

                      At least this proposed policy could also have the effect of halting rich immigrants buying residency or citizenship without having to cough up where it matters for the privilege.

          • mikesh 2.2.1.3.3

            "Am I missing something?"

            What you are missing, weka, is that the rent that one saves from living in a $1,500,000 freehold home is a sort of quasi income (as Gareth Morgan was at pains to point out during the last election) and should be taxed as such. $5,000 seems very cheap. TOP's current policy would have such a person paying just under $15,000.

            • weka 2.2.1.3.3.1

              and TOP would give large amounts of that to people who don't need it and not give enough to people that do.

              They also want poor people to pay annual tax on the value of their family home.

              But interesting point about quasi income. Not sure about that. This is either uber wealthy, or people living in places like Ak that bought a house before the property boom and whose house value has increased exponentially.

              • Craig H

                The principal difference between this and UBI is framing. It's possible to design two systems using guaranteed minimum income (GMI) and UBI, and have them deliver identical outcomes.

              • mikesh

                Actually a flat tax + UBI system is just as progressive as the current system and in fact more so, since incomes below $39,000 would, under TOP's current proposals, be subject to negative tax. Beneficiaries, I think, would receive a top-up on the UBI and so would also be better off.

                The tax on housing that is proposed is not a tax on the value of the house itself, but on the homeowner's equity in the house. And in the case of rental properties the tax is only to be levied if the landlord's income from the property is less than 3% of his equity, so it should not affect rents.

  3. That_guy 3

    Really happy overall. I'm already seeing a deliberate attempt to misunderstand this by the right. For me the most important points are that those who are asset-rich but income poor can defer payment until sale, when the tax bill is likely to be equal or lower than capital gains. So effectively those on that situation can just treat it as a capital gains tax. Also a couple could own 2m clear and own a dozen cars and boats and pay zero.

    I also just love how it's a middle finger in the air to those who say "you can send the ambulance to the bottom of the cliff but you can't do anything about the top of the cliff".

    • Matthew Whitehead 3.1

      The examples actually also make it clear that people without fixed incomes can also defer if for example they have a low-income year. It seems a pretty fair way to handle things.

  4. Wayne 4

    The way the polls are going the options seem to be a Labour/Green government of a National/Act government. NZF looks like it might not get back with probably a 50% chance of not getting 5%.

    So in both cases, what does the major party have to offer the minor support party?

    It has to be something significant, but not so much that major party ends up being seen as the cypher of the minor party.

    In the Labour's case it will be easy to concede more green (environmental) policy, but no so on social justice policy. Labour will basically keep that to itself. But they will give something, possibly another $25 on to top of the basic benefit.

    In particular Labour will reserve tax policy to itself. The public will always see any tax as being major party policy. A major party can't blame a tax increase onto a small party. The public simply won't believe that.

    Because NZF is going to struggle, there will be heightened public interest in Labour's tax policy. Will Labour have a new top rate, perhaps blaming Covid? Maybe 36% over $120,000.

    As for National, what will they give to Act? RMA reform, regulation review? Probably National will give less to Act than Labour will have to do for the Greens, since Act is less powerful than the Greens, particularly due to Epsom.

    • Tricledrown 4.1

      ACT will wag the Dog more as National has already given ACT all it wants ie Epsom.

      National give ACT virtually anything they want.

      • Wayne 4.1.1

        Tricledrown,

        I know from direct experience that National does not give Act whatever they want. Because Act is dependent on National, they basically have to accept what National is prepared to give. And as is always the case with major parties, that is as little as they can decently do.

        And on your point about the Greens, National would have zero expectation of doing a coalition deal with the Greens. Though if National/Act is the govt, National may do some environmental things where they need Green Party support, rather than getting ACT to support. Probably in respect of the implementation of the Zero Carbon Act.

    • Tricledrown 4.2

      Wayne the Greens may go with National as Muller and Shaw have a close working relationship ,the Greens said they wouldn't rule out National this time round.

      So Goldsmith should stop telling lies and not dump on a future coalition party.

      [don’t take this personally, it’s a matter of timing and you being the first person I’ve seen do this since the Greens’ campaigning started, but I’m not going to spend the next three months wasting my time correcting this when the information is in the public domain. Froggleblocks and Matt have explained below about the Greens position on National. If you want to make claims of fact from now on you will have to provide an explanation that backs that up and a link (not a link on its own as I’m also not going to read whole screeds trying to parse someone else’s argument). Making a note in the back end about this because I’m sure it will come up again – weka]

      • froggleblocks 4.2.1

        Green party members decide which parties The Greens would form a government with. Shaw and Muller's personal relationship is irrelevant.

        • Matthew Whitehead 4.2.1.1

          Correct. Shaw literally can't railroad through a coalition deal the members don't support. It requires local branches to support the deal on behalf of their members- so basically, you need 75% of branch delegates to support the deal, which means 75% of active members at each branch appointing enough delegates who are for the deal that it gets 75% support. The deal with Labour met this threshold in 2017.

          Also, it's worth noting that Shaw literally can't approach National for a deal unless the Greens change our approach to allow for proactive negotiation with them. He could bring an initial offer that National made to us to a Special General Meeting to ask for permission to negotiate and a proposal for a team to do it, but he'd need to pass the same 75% of delegates threshold in order to get consensus to go ahead.

          I should also note that given there's already a small minority faction that is very opposed to Shaw's co-leadership, him trying to sell such a deal to members might expand opposition to his co-leadership and result in a vote of no-confidence in him at any SGM that he did try to push through an unpopular deal with National at.

      • weka 4.2.2

        mod note for you Tricledrown.

        • Tricledrown 4.2.2.1

          Sorry .

          • weka 4.2.2.1.1

            I'll take that as an acknowledgement you understood.

            Can you please get in the habit of checking replies to your previous comments? It's a hassle for moderators to have to chase people up like this. You can check for replies by using the Replies tab on the right hand side of any page. If you can’t see that please let me know.

            Once you have agreed to do this, your comments will start appearing in the front end again and all will be good. Please remember this going forward, as this has been an issue for moderators in the past. Thanks.

            Edited.

          • weka 4.2.2.1.2

            Hi Tricledrown, you've been taken out of the blacklist, but I need you to reply to this comment specifically, so that I know you are paying attention by using the Replies tab to see if a moderator has posted a request. This is to reduce moderator time in the future if there are any other issues. It's not fun having to chase around after people like this.

            You're still in premod so it is easy for me to see your reply.

            Your email address looks fine to me.

    • Matthew Whitehead 4.3

      This is not true. Polls indicate the likely options right now are an outright Labour government or a Labour-Green government. All other things equal, the results will narrow a bit more before the election, most likely, but at current support levels there is zero chance of a National-ACT government.

  5. RedBaronCV 5

    As an aside I'd also like to see more emphasis on universal basic services, Just how many power companies with overpaid executives do we actually need?

    • weka 5.1

      Yep. Looking forward to seeing other Green policy. Maybe covid has prompted Labour to be a bit more progressive.

  6. Rosemary McDonald 6

    https://www.rnz.co.nz/national/programmes/morningreport/audio/2018752651/green-party-reveals-new-plan-to-combat-poverty

    I confess to finding Marama Davidson a little annoying so all I heard when this first aired this morning were the repeated "prouds" and "braves". I switched off.

    To my shame.

    Davidson displayed a thorough and in depth knowledge of this policy work which tells me that there has been much thought and discussion gone into producing this.

    It is perfectly right that those who have shit loads should share.

    Andre's concerns above are thoroughly addressed in the document you linked to weka and he should be comforted that there will be no finger thrust down his throat.

    On the whole…this sounds like a very good start.

    I liked the bit where Davidson told Ferguson that this was a bottom line policy…

    Be staunch, Green Party, while you refine this policy.

    And have a picture of Metria in sight to remind you all how rapidly a campaign can go tits up when all are not on the same page.

    Good work.

    • Drowsy M. Kram 6.1

      yes

    • Matthew Whitehead 6.2

      Honestly, I'm impressed with a lot of the detail already- they've thought through abatement thresholds for the GMI, (65% above $165) moving disability to ACC and making the organization a comprehensive benefits scheme instead of being based on arbitrary rules about why an individual can't work. Explicit intention to remove ALL benefit sanctions, which implies that "punitive sanctions" language from the agreement with Labour is much too vague. Trust rules for the wealth tax are straightforward: charities are exempt, otherwise identifying the individual beneficiary owners allows you to use their asset levels for exemptions or 1% rates, otherwise trusts will be taxed at the 2% asset rate if for instance there are too many beneficiaries to reasonably value their individual stakes in the assets. Joint assets accrue towards the $1m threshold at the rate of net ownership, so a 50% ownership of a farm valued at $3,000,000, but with a $2,000,000 mortgage, only counts as $500,000 of assets for that owner, so on its own wouldn't bring you over threshold.

      37c and 42c rates for higher incomes are reasonable. Asked for clarification from Marama about intentions for the accommodation supplement, who says it will stay the same as it is currently under Green policy:

      https://twitter.com/MaramaDavidson/status/1277369493677694977

      • weka 6.2.1

        I haven't played with the abatement figures yet, I'm assuming there are rationales for the rates and threshold but haven't seen them. Do you have any insight on that?

        • Matthew Whitehead 6.2.1.1

          Nope, haven't looked into it in detail, just ran into someone not understanding that there would be abatement to part-time work on Twitter, and had the rates dropped on me by Ricardo Menéndez-March when I said they weren't in the press release but there would surely be an abatement rate. 🙂 The Greens seem to be very active regarding this policy on twitter so I imagine you could ask about the thinking behind the specifics on the abatement rates for the GMI.

          (There's also a separate abatement threshold of $49,000 and rate of 20% for the restructured version of Working For Families in the policy, which is included in the press release, so I'd be clear as to which one you're talking about if you do ask)

    • gsays 6.3

      Couldn't agree more Rosemary.

      I was impressed by Marama Davidson's delivery. Spoke well, answered the questions and I liked the way she turned a sticky question about heroes or brave into being proud of the courage the Green Party is demonstrating.

      Whats not to like about the policy?

      Rich folk can call a private wahmbulance for their affluenza related conditions.

  7. Tiger Mountain 7

    Excellent policy from the Greens. The time is right with our thousands of newly minted “deserving poor” who will likely pay some attention to this. Prior to Covid this would have been super appetising raw meat for fans of NZ’s second favourite sport…“bennie bashing”.

    There is an existential angle now to social security for many more people–there always was of course! in terms of inequality endured by hundreds of thousands after 35 years of “Roger’n’Ruth’s” legacy.

    It will take a big Party vote for Greens, and wide public support to get a GMI happening. There is now more to fight for in the general election. It puts rolling back monetarist orthodoxy, and the structural embedding of neo liberalism, totally on the agenda.

    • Matthew Whitehead 7.1

      It could also be manageable with moderate support but being the only path to Government for Labour. I know I'll be treating progress towards this policy in the agreement as a bottom line, specifically everything that's brought over from the WEAG report is a personal bottom line for me. Members I've talked to on this topic have had similar views.

  8. Stuart Munro 8

    It's a promising idea, and a small long-overdue step to address the trend toward rampant inequality we've "enjoyed" for the last few decades.

    But then the Greens were to clean up our rivers, and instead are left trying to greenwash a water quality standard eight times worse than China's.

    Their attempts to sell the wretched capitulations imposed on them in coalition to their supporters aren't much more convincing than National's claims of economic acumen.

    • weka 8.1

      It's so interesting to me that still people blame the GP for what NZF does, or how MMP works.

      If the Greens slam NZF and/or Labour when their policies get watered down, how do you think the relationships will work on the next policy?

      It's inherent in the GP political position, being the most leftward party but smaller than Labour, that they will *always have to compromise. This is not new, neither is the green bashing or continually framing them as ineffectual and weak. This doesn’t serve the left imo.

      • Stuart Munro 8.1.1

        Perhaps – but nitrate toxicity is an implacable truth – not one that bends to political convenience.

        It is patently obvious we urgently need to reduce nitrogen inputs into our water, not just for the sake of ecosystem health, but to reduce the butcher's bill our people pay to cancer year in and year out. Mike Joy

        • weka 8.1.1.1

          are you blaming the Greens for that?

          • Stuart Munro 8.1.1.1.1

            It was long an article of debate within the Greens, whether being in government would lead to invidious and unsustainable compromises.

            “I think it's a waste of paper, personally,” says Professor Russell Death, one of New Zealand’s most prolific freshwater scientists, describing the $700m programme he had advised on.“I don't think it does anything. They might as well not have put it out.”

            As the party whose constituency has a particular stake in environmental issues, and in freshwater in particular, the Greens should at least have strongly and publicly opposed it, if, as you suggest, the political realities compelled them to do no more.

            Not having done so calls into question not merely their ability to progress policy, but their commitment to doing so, which leaves one wondering what proportion of the GMIP policy might survive the same process.

            • Dennis Frank 8.1.1.1.1.1

              Thanks for that, Stuart – I hadn't seen it. One of the best environmental reports I've ever seen! The reporter's account of the politics of science at the public policy interface is a classic exposition. They ought to use it as a model in teaching journalism.

              What I learnt from leading consensus decision-making processes within the Greens is that one can only finesse the herding cats thing by process design. Design for behavioural constraints to optimise results.

              In situations like the one described, where you have competing groups as well as individuals, that would be crucial to success. I suspect whoever had been given the overall organising role could only do the basics of that and it proved insufficient…

              • Stuart Munro

                Glad you liked it. – Not to rain on the Greens parade too much (or Weka's thread come to that), but giving Joy & Death et al a couple of rivers to play with, and some funds to prototype mitigation/restoration efforts should not be an insuperable problem, and would draw the teeth of the critique without either loading cockies with impossible costs or abandoning rivers that, as climate issues develop, are likely to become increasingly important.

                • Dennis Frank

                  Now that seems dangerously sensible. Not sure if our parliamentarians could cope with such radicalism! The idea of offering an expert the opportunity of demonstrating their expertise in the public interest has probably never occurred to them. 😎

                  • Stuart Munro

                    offering an expert the opportunity of demonstrating their expertise

                    I rather think the Bloomfield experience has given them a taste for it.

            • weka 8.1.1.1.1.2

              As the party whose constituency has a particular stake in environmental issues, and in freshwater in particular, the Greens should at least have strongly and publicly opposed it, if, as you suggest, the political realities compelled them to do no more.

              Not having done so calls into question not merely their ability to progress policy, but their commitment to doing so, which leaves one wondering what proportion of the GMIP policy might survive the same process.

              This seems reasonable comment to me, and I wish people would use this approach as the starting point and then we can move on to talking about what the GP could do differently (rather than people just taking potshots over the whole MMP/NZF bullshit and compromises).

              Personally I doubt that commitment is the issue (given the party is made up of members), but I do agree there have been issues of the GP not standing up strongly enough. Some say this is a chosen approach, I've been wondering if they're stretched timewise.

              Otoh, I've had to watch 24 hours of liberal twitter preferring to talk about Bennett's resignation, and National lies, and some hooha between a comedian and a GP MP, than to talk about the most progressive welfare policy probably any of us have seen. Dunno what that's about, maybe people are worn out because of covid. Good response on TS, but much of it was about the tax and the election, not a lot about the manaakitanga or what the policy would mean for so many.

              I'm not that confident today that the left actually want a strong Green presence in govt.

              • Stuart Munro

                I'm not that confident today that the left actually want a strong Green presence

                The other day someone quoted of all people Goebbels, who states that 'the intellectuals will never be converted'. The Greens have a difficult constituency, many of whom are the most educated people in the country. The casual lies of a Woodhouse or the facile elisions of a Key will not slip under the radar of such an audience, and they will likely resent any such attempt. The Greens cannot spin the dross the Coalition leaves them into gold with any degree of ease.

                But at least they continue to author some of the best and most significant policies. Let us hope the GMI is one that survives to reflect credit on its authors.

                • weka

                  What do you think the Greens should do then, instead of spinning dross?

                  • Stuart Munro

                    I think they need to ask for a war chest. Shane Jones had a huge one – they don't need as much, though with discipline they might well make constructive use of more.

                    Proving studies and trials of pro-environmental interventions – the freshwater one is reasonably obvious, but others are needed: water conserving farm or horticulture models for drought prone areas. Dairy mitigation models at both the farm and district level. Training and retention models for industries that claim perennial labour shortages. Not so much full blown regenagriculture as transitions or side hustles that encourage adaptive change.

                    The organic certification bill needs redesign – MPI are throwing in a cost plus flat charge without adding value – this will discourage new entrants or partial adoptions, which ought to be encouraged. (Aquaculture startups face the same tribute gathering hurdle – we won't see new models from school kids with MPI glomming fees like a petty crime boss).

                    We should be farming the long acre – with something that meets MTA needs, but produces value and ideally reduces road deaths. Harakeke might work in some areas – and makes a plausible cushion barrier.

                    Transitional ag & hort for a warmer and drier climate. Aquaponics for its recirculating negligible water consumption model. My old favourite saltwater greenhouses. Coastal shipping reboot.

                    I imagine Robert could float a mort of plausible schemes – the global recession necessitating intervention, and climate change, are upon us – inaction and/or kicking the can down the road is going to go out of fashion.

                    And 1080 – plan should be to phase it out. Poison has a legitimate place in integrated pest management plans – but it must not be mistaken for the best option just because it’s cheap.

    • greywarshark 8.2

      Don't blame the Greens for being unable to smash down a brick wall just using their heads and rocks – the environmental way! Thank God for the Greens as a belief in higher principles of fairness and living in harmony with people and nature seems to be beyond the mentality of the other Parties . To them it is like a dream island floating on the water like in the song Bali Hai. A verse in it says 'Your own special hopes, your own special dreams, bloom on the hillsides and shine in the streams. Great words – turn Bali Hai into Aotearoa – vote Greens.

      Despite criticism, Shaw has showed that the Greens can work with business interests, and they aren't just a bunch of long-haired hippies or earnest environmentalists either. Metiria Turei showed with her dilemma of being a solo mother trying to train for a career as a working parent, the loss of feminist objectives and gains for sole mothers with only middle-class women being the main beneficiaries. The difficulties of the derisive 'social welfare' system was confronted then and then retired to the back for ongoing activism. The Greens have touched all the problems facing us today, and looked at them and at their magnitude and stuck to looking for and implementing better ways when they can.

      It is a lot to take on, other Parties specialise in one thing and put camouflage blankets over the rest hoping that they will be overlooked. So at the end of the day, being objective, the Greens have done much and shoots are appearing out of polluted ground, and need nurturing for our ultimate benefit.

      There will be plenty of wealthy drawn to us as in this video from South Pacific with Juanita Hall telling of all island advantages. In NZ they are gradually being depleted by we incomers, late and new, so back the Green Party to conserve the country while we work for the best way to manage ourselves in the Climate Change and incorporate ourselves into a world order that is an improvement on the present.

      (https://www.youtube.com/watch?v=ww7xsdfDvn0 – Bali Hai (and after that women doing clever things like performing monkeys to catch Harvey Weinstein's eye? The fresh, sweet possibility then the degraded present!)

  9. Kay 9

    Weka, like you I view welfare from the disability side, but welcome any well thought out, costed and of course, fair for all policy, and I do hope this will get the public (especially the undecided) thinking.

    My biggest concern is that benefit-reliant ill/disabled are STILL more the most being left out of the public welfare debate, which is currently focused on the Jobseeker's conditions and pre-covid also Sole Parent. Part of the 'if we're not mentioned then we don't exist and there's no need to acknowledge our plight and how badly the welfare system is treating them' policy?

    Case in point, Susie's grilling of Goldsmith this morning, asking him if he's happy for people on Jobseekers to stay on $250 a week and his stock response of work being the only way out of poverty. Once again, where was the media asking exactly the same question but about disabled? They just don't do it. How can we get the media to get across to the public that we even exist, and are affected by these policies? The Greens are the only ones who acknowledge our existence.

    • weka 9.1

      I agree. I realised last night after I'd written most of the post that the focus on disability would mean people were less likely to engage. I think NZ still treats disabled people as something over there, we should be kind but they're not regular NZers, right? It's not a central issue to politics.

      Hence the TOP UBI that treats disability as an afterthought, and Labour can't even bring itself to formulate proactive policy. MSM are going to be focused on unemployed because they're the real NZers.

      I'd love to see the covid conversations broaden out into the value of unpaid work a la Waring. Then we might stop framing worth as workers, undeserving poor (bludgers), deserving poor (children) and the other deserving poor at the end (disabled people).

      I think it is getting better albeit slowly, and am hoping that the ACC reform will get people thinking about fairness and the role of disabled people in society. I hate that we still have to define ourselves in negative terms, and much of what excited me about the Greens' policy was that it allows for all people to have adequate income as a right and then we can all get on with doing what we do in a proactive way without having to be in this perpetual cycle of begging for what we need because society thinks there is something wrong with us.

  10. AB 10

    Good in principle I think, but the wealth tax threshold is too low to be widely politically acceptable. Given the grotesque and deliberate inflation of Auckland house prices by the previous Nat administration – there are crappy 3-bedroom boxes nominally 'worth' over $850k. Once a mortgage is paid off and you are approaching retirement, that doesn't leave you a lot of room for some other savings in Kiwisaver before you get hit by the wealth tax. And right at a time when income starts to decline – with plenty of people getting turfed out of jobs from their mid fifties on and never recovering the same earning-power. If quite unexceptional middle-class people have to start liquidating assets and downsizing homes to pay a wealth tax, watch out. It needs to go after the truly rich, with a higher threshold and at a higher rate.

    • weka 10.1

      Henry Cooke wrote about this. The settings in effect mean that most people won't be onerously affected. There's also the option of deferring payment until sale if you don't have adequate income, which isn't ideal but is like a backstop for the small number of people in that situation.

      I don't think we should let the Auckland housing crisis dictate social security policy. Those places are grossly inflated and that's another whole set of problems to solve. I also think that if people's properties are accruing so much capital that they can't afford to pay a high end tax, then it might finally get them to start thinking about the problems with the property market.

      • RedBaronCV 10.1.1

        Is it a problem with the property market or is it a lax immigration policy blowing out population numbers without any corresponding social investment in housing? Plus foreign trade agreements that have enabled turbo charged off shore buying by non resident individuals. Fixing immigration and the so called "trade agreements" would go a long way towards sorting house prices.

    • Matthew Whitehead 10.2

      If you own a $850k property on your own without a mortgage, you're pretty well off, and it's not unreasonable to pay a tax if you also manage to save more than $150k for retirement. Remember, if you have $1001,000 of assets, you pay $10 of tax, so it's only when you have significant assets over $1m that it becomes a significant burden that incentivizes you to have those assets in forms that give you productive returns.

      If you own a 50% interest due to a joint title, it only counts as $425k towards the tax threshold. If you have a mortgage, you also subtract your share of the mortgage from the value of the property for the asset tax.

      There's a reason it's estimated to only hit 6% of people: because it's actually a quite high threshold to hit once you dig into the detail.

      • AB 10.2.1

        I hope so Matthew – because on these numbers I reckon it's too easily spun as 'penalising success' and 'eliminating ambition'

        • Matthew Whitehead 10.2.1.1

          People who are wealthy because they're successful are earning far more than a 1% or 2% return on investment. This doesn't penalize success. It taxes assets at a threshold where they are most likely providing a significant capital return, so it's fair to ask for a share of that return and is not a "penalty," but rather a re-investment into a society that supports your businesses or other work that’s earned you so many assets, and has enabled you to become rich and successful. It's especially reasonable to set high tax rates at a rate where they pay for the safety net for those who aren't as fortunate, and need a chance to bounce back and participate in society.

          And quite frankly, given how much of the tax return is on income tax, it's actually a lot fairer if we have an asset or capital gain tax to those income tax payers that a share of policy costs are put on capital assets.

    • mikesh 10.3

      The problem of shabby houses in expensive properties seems to be that the land value makes up too great a proportion of the total value. With an $850,000 property the land may be worth say $750,000 and the house $100,000. In this situation a land tax would seem more appropriate than a wealth tax since, in that case, the taxable value of the property would not change in one sought to make better use of the property, perhaps by demolishing the house and constructing a block of flats on the site.

      A land tax would generally be a better form of tax because the amount of land is fixed and such a tax would promote more efficient use of it.

  11. Koff 11

    It is good policy and good politics released at just the right time. No rusted on Nat voters will like it but it's a policy that just might / should galvanize the people who have been left behind and haven't had the motivation to vote for any party in the last few GEs.

  12. Funny how the middle classes were stoked about asset values doubling under Key but start howling poverty at the idea of giving back a tiny percentage of that free money

    Funny how right wing bloggers go into all sorts of mental contortions over tax ruining their lives, but don’t care about low income/beneficiaries’ lives

    • Matthew Whitehead 12.1

      It's a bit sad too, as this policy demonstrably won't affect normal middle-class families. Hell, even upper-middle or lower-tenth decile families won't be effected under estimates, just the top 6% most wealthy kiwis in terms of non-household assets.

      • roblogic 12.1.1

        It should be motivational, the top 6% can pull themselves up by their bootstraps in the face of this adversity

        • Matthew Whitehead 12.1.1.1

          Yep, gives them an incentive to make sure all their investments are expected to return more than 2% profit over the time period they have them, which should increase the productivity of our millionaires. 😉

      • RedBaronCV 12.1.2

        I'm not so sure about it only being 6% of kiwi's or even the right % being hit with the wealth tax.

        I did a quick tote up of my neighbourhood (not that I know all the financial details but I can hazard a guess) and out of 12 households:

        – 7 are single person households and they will all be hit.

        – 5 single person households have or had modest jobs own only the one property but have owned it for over 10 years and likely kiwisaver or some other limited investments and are hit by reason of the house only..

        – 2 single person households either own 1 other property or had a higher paying job so likely to have other investments.

        – 5 households have couples in them. None would be hit because of the house only and all would have a lot of headroom to have other investments including property until the day one of them dies..

        The $1mill exemption for the second person of a couple is huge in this context and enables a couple to have a house plus substantial income earning investments while the single household has the house and any extra investments are being taxed at 1%.

        This scenario is likely to be replicated in most streets in Auckland. Overall I think we have about 1.2 mill domestic dwellings and about 700,000 to 800,000 owned outright or with very small mortgages ( mostly those who have owned for 10 plus years.) That's a lot of potential hits.

        Plus if any threshold is not indexed a lot more house owners will creep into the bracket if there is further house price inflation.

        Also is it going to pick up offshore owned assets and how are they going to identify these please? As far as I know nobody really has a clue how much people own overseas. I had been privileged in earlier years to gain a sideways view for some people and boy you ought to see what they had. But basically any tax that hits someone locally at a higher rate than the offshore domiciled but owning land, businesses here (think Peter Thiel) is not going to be popular.

        • roblogic 12.1.2.1

          Sad that so many people are focused on weird tax situations that don't apply to most Kiwis, and ignore the positive aims of the Green policy, of radically reducing poverty in Aotearoa. From page 11 of the policy paper the projected tax will impact only the top 6% of wealthy New Zealanders. This proposal isn't even as radical as John Key's infamously regressive tax switch

  13. adam 13

    And it will end up not being talked about because they dumped Rose Matafeo in what looks like an exercise of cancellation.

    That will be the headline tonight, not the release.

    https://twitter.com/Rose_Matafeo/status/1277352764574543872

    • weka 13.1

      • Ad 13.1.1

        It's an important policy to get squashed by daily events.

        Tell Marama it's worth re-launching this closer into the election cycle.

  14. UncookedSelachimorpha 14

    Overall very promising policies I think. I usually vote Green and certainly will this time given this.

    A "Tax Calculator" could be a helpful tool to explain the impacts.

    I have detested almost everything about NAct and everything they stand for. However if the Greens entered an agreement with them that implemented this Poverty Action Plan (because Labour wouldn't) …I would have to very seriously consider that compromise!

  15. Mohammed 15

    Green Party wants people to pay more taxes. There are some people who don't want to work and some do.The people who do hard work,why they pay more tax for those who don't want to work .That's unfair and you make all bullshit manifestos for the people of New Zealand.

    • roblogic 15.1

      Exactly. Wealthy property owners don't do an ounce of work for their capital gains, it is deeply unfair.

      But I think you have the parties confused. National punished workers with GST, horrible rent conditions, and a housing crisis.

      Let’s tax unproductive wealth, not useful work

      • mikesh 15.1.1

        The fact that they don't do any work for their capital gain is precisely why the gain should not be taxed. The usual source of income is work, or the provision of services. Therefor the only source of of the cash that makes up capital gain is the buyer of the property. Is anyone proposing to provide that buyer with a tax rebate? If not, why not? Probably because simply "robbing peter to pay paul" would seem a rather pointless excercise since the net return to the government would be zero.

        • roblogic 15.1.1.1

          A weird concept. So you're in favour of a housing bubble and rampant speculation? I don't get it

          • mikesh 15.1.1.1.1

            The concept is not at all weird. What do you not get? If it's the notion that I might be in favour of property bubbles, then you will no doubt be happy to know that I am not. The argument I put forward above has nothing to do with property bubbles, nether for nor against.

            • roblogic 15.1.1.1.1.1

              I suggest to you that work should not be taxed and useless wealth should be taxed to hell and back. The current tax settings are highly regressive, punishing productive labour, but rewarding rentier and hoarding behaviour. The Greens’ plan rebalances that somewhat. Housing should not be an investment vehicle.

              • mikesh

                Governments need to divert a part of their country's productive effort to public use. Since productive effort is reflected mostly in income governments tax income. Also since money is the appropriate means of paying tax , and most wealth is not held in the form of cash, wealth is a pretty limited source of taxation.

                However, I agree that a case can be made for taxing rentier income more heavily than taxing work.

                Housing cannot avoid being an investment vehicle since family homes are essentially an investment.

      • KJT 15.1.2

        Exactly. That is what the oft misquoted right wing guru, Adam Smith also said.

    • weka 15.2

      what work have people done whose property is now worth $1.5million simply because of the property market blowing out?

      • mikesh 15.2.1

        Quite right. So at first blush it would seem unfair to exempt family homes in the event of introducing a capital gains tax.

      • mikesh 15.2.2

        "what work have people done whose property is now worth $1.5million simply because of the property market blowing out?"

        They may not have done any work but, depending on how much they paid for the property initially, and depending also on the length of time during which they held the property, the aggregate interest that they would have paid may swamp any capital gain that might have accrued.

        • roblogic 15.2.2.1

          Your attempted justifications are unconvincing twisted logic. What kind of country do we want where millionaires refuse to pay a bit more to help the less fortunate

          • mikesh 15.2.2.1.1

            Despite your pseudonym your comments are not logical at all. They are just a rant.

            • roblogic 15.2.2.1.1.1

              That's because NZ is full of nouveau rich arseholes with million dollar houses that doubled in value under John Key and fucked over everyone else. These parasites now strut around boasting about how smart they are, but spit the dummy if anyone suggests maybe this unearned capital gain is a little unfair

          • mikesh 15.2.2.1.2

            I think you are confusing work and money. Perhaps it doesn't matter where the money comes from, but someone has do some work if government is to function. But as I suggested above rational thought doesn't seem to be your strong suit. Ranting, I would say, is more your style.

    • greywarshark 15.3

      Mohammed It isn't simple, and I tell you you don't understand the way that people are taxed here. And we don't understand either; but one thing we know is that some who have lots of assets and cash manage not to pay much tax, some who are just getting by and working or are something called, underemployed, are paying more tax than they can afford, and some are unable to earn enough to live on or who can't work because they are sick, get little and pay at least 15% on most of it. That's not bullshit.

  16. Mpk 16

    Thank goodness for the Greens. Looks like I'll be renewing my membership after all

  17. Pat 17

    A good policy proposal by the Greens and hopefully one that sees their electoral support increase significantly.

    Also provides another incentive for those with the wherewithal to move investment into productive areas and away from speculation…two birds with one stone.

    • Gosman 17.1

      They are just going to cannibalise Labour's vote a spook some center Labour voters to return to National.

      • Dennis Frank 17.1.1

        No no no Gos, you clearly don't understand extreme leftists. It's that missing million! Policy clearly directed at motivating them to vote Green. Grab a calculator & work out how many extra Green MPs they get in if it works! If. 🤩

        • McFlock 17.1.1.1

          So the greens get some lab voters = govt neutral.

          Some lab go to nact = slight loss to govt.

          Provided the net govt loss (not including NZ1) is only a few percent, the move gives the greens more leverage in government, up until it makes NZ1 necessary for govt or even makes labgrn incapable of forming a government.

          And that's if the "floating voter driven by policy" model is useful.

          • Dennis Frank 17.1.1.1.1

            My take from Jacinda's response this morning is that Labour won't accommodate the Greens on this pre-election. Doesn't mean they'll go full neoliberal though, eh? Maybe carefully nuanced, to leave open a progressive compromise.

            But it will be a test for centre-left voters, so the next polling done (after they've had time to absorb the signal) could reveal the alienation factor.

            • McFlock 17.1.1.1.1.1

              AFAIK labour and the greens haven't signed a coalition agreement or MOU for the post-election government yet. Chillax, the Greens have announced a policy, that's all. Unless Labour have announced the same policy, what do you actually expect from a Labour PM to say about Green policy?

              • Dennis Frank

                If they had been co-designing a centre-left govt for her next term, that may have been evident reading between her lines. All she said was that Labour would be campaigning on its own tax policy. Which I took to mean the two parties are like two ships temporarily sailing the same course within sight of each other.

                No real meeting of minds on collaboration generally -just on a pragmatic issue by issue basis. You'd think the pandemic would have induced them to start brainstorming the future, huh? Not yet…

                • weka

                  you thought Labour and the Greens might be secretly working together on policy as part of approaching the election?

                  • Dennis Frank

                    No. But brainstorming the future would be a worthwhile initiative if the framing was sufficiently loose. It's true that politicians have no natural disposition towards conceptualising, and normally leave that to agenda-providers (overseas, thinktanks). But the pandemic does incentivise them to campaign on a future plan.

                    One would expect such a plan to include policy signals even if somewhat vague. Only two thirds of the electorate are tribal and election outcomes here get produced by the other third, so planners must try to figure out what motivates those voters – so as to identify the right signals for the politicians to send.

                    We've been doing some of that ourselves here (resilience, regenag, etc). Relying on a default to bau is the losers' option.

                    • weka

                      having to play to the middle is Labour's problem though, and the big outcome of this election isn't Nat vs Lab, it's how much Lab, how much Green and any NZF?

                      I assume that the working together for the future stuff happens in normal parliamentary business, outside of party policy development. Hence my approval of the GP tending to relationships with their political compatriots despite our adversarial system.

                • McFlock

                  Nope, certainly not publicly. [edit: there might be a heads-up of contentious policy out of collegial courtesy, but each party’s platform is set by the membership, not party elites horse-trading policies in a back room]

                  They are distinct parties, and the Greens especially need to maintain their independent identity. Why do you think NZ1 has been going a bit right field in the last couple of months? It's staking its claim to that corner of the electorate

                  Labour and the greens are likely to repeat a coalition if possible. But if Labour has 51%, the greens won't have the same influence as say a 45:11% lab:grn coalition.

                  If people want 4 scoops of lefty ice cream, the vote green. I suspect Labour will be one or two scoops of the same flavour, with some apple crumble. Some voters will want a bowl of ice cream, others icecream and crumble.

                  Like last time.

                  • weka

                    nice pudding analogy.

                    This is why I think the missing million aren't the issue. It's the people that voted Green prior to 2017 and switched to Labour once Ardern was on the scene and post-Turei speech fallout.

                    The Greens going for the 10% they had before sounds reasonable, and it will have to be policy that appeals to those people. Policy that serves poor people who don’t vote is a values based thing. Maybe it’s useful in the campaign, but I thought everyone had given up on the missing millions saving the left idea.

                    • McFlock

                      There might be a missing hundred thousand or so, just too busy or sleepy to vote (literally, I suspect I've missed one elction because it was raining and I spent the day in bed). But nobody has a hidden army just waiting to vote en masse as soon as the correct policy sigil is completed.

                    • McFlock

                      Come to think of it, many of my analogies revolve around pudding, cake, or other foods.

                      Damn I hate being a fat man stereotype sometimes lol

        • Pat 17.1.1.2

          indeed IF, but it certainly provides plenty of incentive.

          • Dennis Frank 17.1.1.2.1

            Sure does. Now Marama's put that stake in the ground, it's all down to marketing the policy to pull those folk in…

      • UncookedSelachimorpha 17.1.2

        So long as Greens remain above 5%, cannibalising Labour's vote won't help NAct get back in. Sorry Gosman.

        e.g. (45 + 5) = (40 + 10)
        etc

  18. Gosman 18

    What are the abatement rates on the benefits?

  19. RedBaronCV 19

    The wealth tax ( and I'm not against it in principal- rather more the threshold and exemptions) will also hit most farms,

    It doesn't appear though to include underlying asset values of the defined benefit pension schemes. The main schemes in this area are the government ones and the defined benefits schemes closed about 34 years ago. But a lot of long term civil servants will receive these pensions on retirement whereas the same money in kiwisaver earning an income is likely to be taxed on asset value held in kiwisaver.

    • weka 19.1

      yeah, just seen a farmer say they'd have to pay $140,000 a year, which the business can't do. How would that work then? They defer that every year until the land was sold. If the farm is worth $7m clear, that's $1.4m at ten years, and so on. Seems doable, but a really big mental adjustment for some. Maybe it needs to be reframed away from the debt idea. Caveat on the title?

      • Incognito 19.1.1

        Caveat on the title is an option although that might put pressure on sales prices. The first million net is free from the tax. The second million incurs 1%. Above that it will be 2%. I think that works out at a net wealth of $8.5 million.

    • UncookedSelachimorpha 19.2

      Exposing the problem that for many farms the most valuable output is capital gains rather than actual farming income. Might help shift the value of farms to realistic levels, rather than having them as capital gains "investments"

  20. RedBaronCV 20

    Plus it doesn't really take into account the number of people living in a dwelling. If this is going to hit the modest earning south auckland household where one parent has died and there are still children or young adults living with the remaining parent then it is not a win.

    In some quarters this is electoral suicide and will rub off on labour too

    • Pat 20.1

      Think you seriously overestimate the net wealth of the overwhelming majority of NZers…this apparently impacts 6% of kiwis

      • RedBaronCV 20.1.1

        I've put in some figures later on in this posting and on the Paora posting.So no. Basically main urban center house prices are high, close to the first threshold, so anyone who has owned a house for 10 + years is likely to be caught. Adding up a few figures potentially some million people may be affected right now or when a partner dies. A lot of these are 50+ and if they have been made redundant may struggle to work. If they own only one home then a basic service is being taxed and they have 30 plus years of life to finance.

        • Pat 20.1.1.1

          You overestimate the real estate market as well

          https://www.newshub.co.nz/home/money/2020/02/reinz-reports-multiple-regions-with-median-house-price-over-600-000.html

          but lets assume your argument holds water….thats potentially a million voters who may decide this policy precludes them voting for the Greens… how many of them do you think do now?

          • RedBaronCV 20.1.1.1.1

            I'm sure they don't all vote green as the greens don't get that many votes and it is just an estimate. Nor is it easy to estimate the net capital value of owner occupied homes. Don't forget the REINZ figures are medians and below the median are likely more rentals and small flats in large buildings.

            Will this lose greens votes? They certainly do very well in the Wellington central and Rongotai electorates in Wellington where house prices are higher and permanent populations are in the higher income and age brackets. Still if they are altruistic voters then it may not affect this type of vote too much.

            But I think they have under assumed how many people are potentially eligible , which is problematic , it may well not free up rental housing for owner occupier sale and may cast a negative halo over labour.

            • Pat 20.1.1.1.1.1

              I very much doubt they got the number impacted wrong by terribly much for all the reasons you have outlined….they are after all politicians seeking votes

    • Molly 20.2

      " Plus it doesn't really take into account the number of people living in a dwelling. If this is going to hit the modest earning south auckland household where one parent has died and there are still children or young adults living with the remaining parent… "

      This is a really good point. I hope the policy is adjusted to take this reality into account.

      Accounting for the number of people in the household – which contributes to living quality and health outcomes – is a necessary consideration.

      NZ Statistics often fails in this distinction when it reports on household incomes without reporting on how many contribute and how crowded those households are.

  21. JohnSelway 21

    One thing I would love to see is dentistry being a state service like health. I wish a party would have the mind to introduce such a thing

    • Andre 21.1

      Vision care too.

      • JohnSelway 21.1.1

        Oh, good one. Yeah that would be great.

        • gsays 21.1.1.1

          I am with you on dentistry, it is right up there with mental health in chronically underfunded and expensive treatment.

          When the mouth is unhealthy, abscesses etc, those toxins go round our system, impacting on our health another time.

          I had an appointment recently, and apart from the one molar that needs a filling, I was surprised at the amount of chips and part broken teeth I have accumulated. Although it is the cavity that causes pain, the others are more aesthetic.

    • RedBaronCV 21.2

      Hearing – apparently poor hearing is heavily associated with dementia developing sooner.

  22. Red Blooded One 22

    Well there is nothing quite like Christmas approaching to focus the mind of a Turkey (and yes, I'm calling myself a Turkey) I was very much hoping for a Labour/Greens Government but am not so sure now. In this day and age I think a threshold of 1 mill when you're including property is too low. I realize with good management AND good luck I am on the lucky side of the ledger but with a very little income but asset rich I personally am afraid of this policy with this threshold. Deferment only means racking up debt, a situation I aimed for and worked towards avoiding. Might have to vote NZ1st after all. Argh

    • SPC 22.1

      1. It only applies on net of debt asset wealth.

      2. Anyone asset rich but cash poor has deferred renovation – its largely land value.

      3. Renovation has never been so affordable (and makes the property quick to sell), it also creates jobs and the debt reduces asset value for wealth tax purposes.

      4. Then wait till National returned to government and they lift the exemptin to $1.5M.

      • weka 22.1.1

        what's the renovation bit in deferred renovation?

        • SPC 22.1.1.1

          Simply the fact that those asset rich, but income poor cannot afford to upgrade their property/renovate – such million dollar properties are largely land value and developers often just remove the house and buld a new one or they are on-sold as are to those prepared to do the renovation work.

          My point is that a wealth tax might motivate people to do deferred renovation (while mortgage finance is so cheap) and so create jobs (which generates its own tax revenue flow to government).

          • weka 22.1.1.1.1

            ah, yes, I was wondering about that too. I'm not sure the govt encouraging people to take out loans on their mortgage is a good thing though.

  23. Cricklewood 23

    The trick to getting the forecast revenue to pay for the policy will be figuring out how to plug the loopholes that allow for avoidance.

    That will be a very difficult thing to achieve I suspect. Basically the very wealthy will re arrange their assets/finances etc to minimize their exposure to new taxes.

  24. Jeremy 24

    I'm in the group that this tax is aimed at and off the top of my head I can think of numerous ways one could arrange one's affairs in order to avoid this, depends on what ends up being legal and no doubt the layers and accountants are already at work, rubbing their hands with glee.

    Sounds like a trip back to before 1984 (I was only born in the early 80s but I've heard tell from the old timers how bat s**t crazy it was) where fortunes were spent on accountants that ensured schemes like this raised little. I haven't engaged in "tax planning" in the past, but I certainly would if this was brought in – as would all the other business people I know. I've only focused on efficiency in the past but this would definitely change my behaviour.

    This is especially crazy given we are entering in a one in 300 year depression if the Bank of England is to be believed.

    • Incognito 24.1

      Don’t panic, Jeremy, the Poverty Action Plan is not aimed at you or all the other business people you know. It is aimed at Poverty. If your individual net worth is $2 million, you only have to pay $10k pa. Don’t run to your accountant, get married and instantly half your individual net worth. My neighbour is single still. And think of all the ‘fringe benefits’ that come with a rich and fulfilling marriage, all tax-free; married men live longer too.

      • Jeremy 24.1.1

        No panic or running off anywhere. My Accountant and I talk regularly as a natural course of business, I'm sure she will bring this up next time we talk or her firm will email me about it (as they did when Labour was chasing their hare brained CGT scheme) and they'll already have a number of plans based on the policy documents. In the past my advice has always been to them to be conservative in interpreting tax laws as I want to sleep well at night, but I'll be more willing to take risk with this kind of nonsense.

        It's an extra $10,000 per million on the already copious amounts of tax my employees and I pay from a business, and on assets, all generated from something started in an Auckland garage and taking market share away from a multinational which does play these types of tax games (one of them I worked for bought most of their supplies through an Irish subsidiary – 12.5% corporate tax rate – even though everything shipped directly from Malaysia to NZ).

        This type of proposed policy is incredibly frustrating given that I have avoided the above shenanigans and the losses and effort it has taken to keep all my employees on board through this ridiculous lockdown and border closure.

        • weka 24.1.1.1

          How would the policy affect you personally? How would it affect your business?

          • Jeremy 24.1.1.1.1

            There's the increased taxes for one, but more importantly the change in the way the state wants to look into my affairs by me having to value all my assets and declare that yearly. It'll be a huge and costly pain in the arse, on top of all the tax, H and S and other paperwork that already takes away from the enjoyment of business and seeing my kids. I know socialists usually find this humorous (f**k off and take your ball home you rich prick, the glorious workers will take over your business, etc etc – it doesn't work like that FYI) but there is a point where you go, the hell with it I've made enough money and f**k the politicians if they can't deal with poverty with the 40%+ of GDP they already take, and you give your team a heads up and wind everything down – or sell if you think you'll be able to find a buyer – which is difficult for businessess of a certain size.

            A lot of business people are incredibly stressed and on edge at the moment, and things are looking incredibly bleak already over the next few years. That's before this type of thing sticks the boot in. There is a psychological element about incentive, drive, etc that the Greens and their supporters just don't seem to get.

            • Incognito 24.1.1.1.1.1

              You enjoyed building up your business, made good, and sacrificed time with your children.

              The single parent working as a cleaner on minimum wage, unlikely to make good ever, and sacrifices time with their children.

              I see no difference except that one can do something for the other because they have net wealth in excess of $1 million. For example, if one has a net wealth of $2 million this would be subject to $10k pa in tax. It would somebody in full-time employment on minimum wage three whole months to earn that before tax!

            • Craig H 24.1.1.1.1.2

              Valuing assets annually doesn't strike me as useful when we already have depreciation rates and balance sheets, so hopefully that can be worked on.

      • The Al1en 24.1.2

        I can see how it would be mind numbingly awful to only have $1,980,000 in assets.

        • Jeremy 24.1.2.1

          See my last sentence above, it's not about that really, it's about the fact that there is a line, a principle, beyond which business people are prepared to become scofflaws en masse (even if not in actual fact of law) making the scheme unworkable.

          Has the experience of NZ itself as well as the UK in the 70s and countless numerous examples taught people nothing? Generally the tax take has remained the same or gone up in short order when exactly this type of scheme has been removed, or onerous to tax rates (60%+) reduced because people of means will rearrange their affairs to avoid these even if it's not in their best interest to do so, because they object to the policy itself more vehemently than the marginal additional tax they'd have to pay.

          I find it amazing there are whole political parties that don't seem to get this, and think their projected taxes will actually materialise if they just try and write out "all the loopholes".

          • mikesh 24.1.2.1.1

            It seems to me that this proposal for a wealth tax is really a sort of afterthought. It is pretty obvious that the party would have preferred a capital gains tax, but have reluctantly accepted that this is now off the table.

            • KJT 24.1.2.1.1.1

              It is obviously second best, but with the best option, CGT, off the table for now, another Labour own goal to appease people who will never vote for them, we have to try something else. I don't like that part for the same reason I don't like TOP's proposal. Taxing people when they have no money coming in to pay it ends up transferring even more assets to the wealthy who can buy them. However we do need to broaden the tax base to wealth, and if we are ever to again remove poverty all those from comfortable middle class and up, which includes me, need to pay towards it. The hypocritical attitude of so many comments on here. "Please reduce poverty but don't make me give anything to pay for it". Again reminds me of the saying. "Everyone wants heaven, but they don't want to die".

          • KJT 24.1.2.1.2

            I don't think the sort of person who would rather pay $10 000 to an accountant, to avoid paying $10 000 to help out people who need it, are ever going to vote for the Greens.

            You forget property owners have had huge tax cuts, and capital gains, since the 80's, to the detriment of the majority of us.

            And, by the way, Government share of the economy is less than 30% which shows in our increasing levels of poverty and decaying infrastructure.

        • Herodotus 24.1.2.2

          Medium 3-4 bedroom house in Aukland $850-$900k, amount required for a retiree in a city no frills $200k. Already considered wealthy and taxed . Don't the brains behind party policies work these things out ?? Oh to be average and considered a target for being Wealthy !!!

          https://www.newshub.co.nz/home/money/2020/02/reinz-reports-multiple-regions-with-median-house-price-over-600-000.html#:~:text=Auckland's%20median%20house%20price%20in,November's%20median%20price%20of%20%24885%2C000.

          https://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=12216844

          • UncookedSelachimorpha 24.1.2.2.1

            Net wealth is what is taxed. A lot of people with $1m auckland houses will have significant debt, pulling their wealth below the thresholds.

        • Incognito 24.1.2.3

          Many people wouldn’t have a clue about their net worth. Ignorance is bliss. I will have to cancel my two Life Insurance policies when this policy proposal gets serious traction. It wouldn’t be fair on my heirs otherwise 😉

          • The Al1en 24.1.2.3.1

            When I win the lottery I'm going to spend heaps on a team of accountants to stop those communists from taking all my assets.

            • Incognito 24.1.2.3.1.1

              Make it count because accountants are tax-deductible. Nobody touches my assets; it is very frustrating.

              • The Al1en

                The anti communists have convinced me the bother of having all those valuable assets taxed isn't worth striving for or being aspirational to getting them, so I'm just not going to walk to the sweet shop and buy the lotto ticket in the first place.

                You're loss green party, your loss.

                • Incognito

                  From now on I will refuse Bonus tickets. The risk is just too high. And no more Powerballs either.

                  • The Al1en

                    Right, because the powerball is just the unemployed's ticket to your hard earned moolah.

                    • Incognito

                      Exactly! Why would I give a Powerball ticket once a year to the great unwashed so that they can live it up large at/on my expense? My parents only ever gave me Bonus tickets and only if I tidied up all my toys in my room once a week and washed the car that they gave me for my sixteenth.

                    • The Al1en

                      So it's settled. The greens have ruined having individual money and debt free assets over $1,000,000 for everyone.

                    • Jeremy

                      All very funny guys, well done.

                      I note that you haven't really dealt with the argument, and that this tax – if it eventuates – is unlikely to raise much, while having a negative drag on the economy, and the people who you weep crocodile tears for wearing the brunt of any of the actual hardship – as per usual.

                    • Incognito []

                      Actually, we did deal with the argument but you decided not to understand what we were saying and to think that we were merely joking. Taxes are more about behaviour than raw revenue. Poverty-inequality can only be addressed though a change in mentality. You argue that selfish behaviour will nullify any attempts to redistribute excess wealth. QED.

                    • KJT []

                      Only if you believe giving those at the bottom enough to live on is a "negative drag on the economy".

                      In fact the evidence shows the opposite. Successful economies have high taxes on the wealthy and higher incomes at the bottom.

      • RedBaronCV 24.1.3

        But the women don't. They have better mental health unmarried apparently.

  25. Incognito 25

    http://archive.stats.govt.nz/~/media/Statistics/browse-categories/people-and-communities/households/net-worth-of-nzers/net-worth-of-nzers.pdf

    Figure 4.1: Net worth distribution of non-partnered individuals

    Figure 4.2: Net worth distribution of couples

  26. RedBaronCV 26

    based on the notes in the story

    It does not include property held in trusts ( and the family trust is pretty much a given over large parts of society). The top 20% of households who have the most wealth equal around 400,000 households plus those with the house etc in trust. So we are looking at 600,000 to 800,000 individuals( based on how many are married with shared asset ownership) plus those with the houses in trust.

    I take no pleasure in saying this but I can see the impact being on a lot more people than appears at first sight.

      • RedBaronCV 26.1.1

        No trusts are not exempt but according to my reading they were not included in the household net worth statistics in the link. So likely to understate those eligible if the household stats are used.

        • Pat 26.1.1.1

          depends on the number of beneficiaries….the video covers the basis of assumptions quite well.

          It is important to recognise that those who place preeminence upon intergenerational wealth are not nor never will be the Greens constituency….and we are a democracy

          • RedBaronCV 26.1.1.1.1

            I think we are talking at cross purposes. My comment about the trusts referred to the link from stats with respect to household wealth. They were not included there.

            I also know a fair few people who could be considered well off, or even very well off who do vote for the greens. I don't see any particular reason to suggest that intergenerational wealth and the greens are mutually exclusive.

            • Pat 26.1.1.1.1.1

              the preeminence of intergenerational wealth…..and as the video states the wealth stats are “as good a guess’ as any available .

              • RedBaronCV

                I didn't bother to watch any video – I find it a dreadfully slow way of acquiring information. But what is this inter generational wealth that they are speaking of? At the moment it's likely to catch the single house the family grandparents hold and that is ultimately inherited by their children and grandchildren. If this is the case then it is basically a tax on older new zealanders who have always lived here with the money being transfered to a younger poorer generation (including migrants). The migrant's parents who live offshore are able to transfer wealth unhindered by an pesky NZ tax so the transfer is skewed away from the native born whose families live here.

                What it won't catch easily is those who live here but have a passport for another jurisdiction and assets there which not likely to be declared or arrangements will be made for another to hold them, Good luck to the IRD in finding those offshore flats owned in New York, London and Hongkong, castles in Poland and country houses in France. If income has been earned overseas and used to purchase assets then they will be well hidden and any compliance costs would be massive. Good luck with selling this as a policy too. Basically it is saying that if your family assets are onshore you are likely to wind up subsidising those who have the ability to have assets or parents offshore.

                I see Maori land is exempt- I don't mind but that will wind some up plus charities. Does this mean Bishop Brian doesn't pay? If that's the case expect just about everyone to be furious.

                • Pat

                  You may find it a boring way to acquire information but the information is there to be evaluated….better than guessing.

                  I havnt heard the Greens mention intergenerational wealth with respect to this policy that I can recall,…that observation was mine.

                  As stated earlier you overestimate the level at which this policy will impose upon the citizens…household wealth will in most instances be shared for all but the final few years of life significantly reducing those captured.

                  Good luck selling this policy?..lol, as said earlier those fearing this policy (or anything like it) are not the target market…..and the target market is considerably larger than those predisposed to object

                  • RedBaronCV

                    Please don't assume I am guessing – some where below someone mentioned that the greens had made the wealth tax estimate from the best information that they could find. I don't find videos boring so much as inefficient.

                    I'm also looking at the publicly available information to try to get a handle on this. When I estimate that all of my street and most of my suburb and a large chunk of Auckland are going to be caught up with this wealth tax then there is a real mismatch in the expected impact.

                    Querying the identification, compliance and the cost of the compliance with respect to substantial overseas assets (if they can even be located) is more than legitimate.

                    I would possibly even query the relative target market size. I don't have an issue with the reforms at the bottom end of the scale and there could even be other administrative gains. I also hope those impacted by this vote as all too often they do not.

                    It isn't really going to help the younger one/two income working couple trying to buy a home unless there is a house price collapse triggered partly by the policy (which actually becomes self defeating) as houses drop below the $1m.

                    It is going to impact on the 50+ age group who have been hit by home price inflation and who have some 40 years or so to support themselves till death on what could be a very limited income. These people do vote and some of them do vote green (think Nelson & Wellington electorates) In some cases their incomes after tax would be below the new benefit levels. Deferral over 30-40 years thanks to the miracle of compound interest (likely to be charged) should wipe them out financially before death.

                    The truly rich and those with offshore access will be laughing all the way to the bank.

                    So I still say that it is likely to have a larger impact than estimated and if it does – much though it pains me to say this – the greens will get slaughtered and there may well be a negative halo over labour as well.
                    Even the suggestion that household wealth is to be shared by all as a common pond would be unacceptable to a large part of the electorate. A well constructed tax might be accepted but those sorts of statements are regretably a turn off for many.

            • KJT 26.1.1.1.1.2

              Yes I do to. And the reason we vote for the Greens is that we are not willing to throw our fellows, or our common environment, under a bus so we can pay a little less taxes.

  27. Herodotus 27

    Why $100k and $150k for new tax thresholds and $1m and $2m for wealth. This just seems a couple of lazy figures that have bee selected without much thought as to them.

    PAYE tax there should be more targeting certain % of the pop. income levels. Under kiwibuild we are told that what is now considered an income that warrants an increase of tax levels is also an income that warrants govt assistance to purchase a house. How can both be true ??

    I would struggle to ascertain the wealth of my parents having total control of their finances due to age and under lying conditions- Cannot see how a govt could calculate this?

    So this policy has been costed ?? What about the offsets from sickness benefits, student benefit, Unemployed benefit etc, These should be offset with the increase in costs of this policy, and then depending upon any shortfall, how that shortfall will be offset.

    "Gone are the married/de facto rates that have long penalised couples. The ACC changes have been a long time coming, to settle inequity issues in disability from accident vs health"- Perhaps because Kiwis gave up any legal recourse for the cover of ACC – Sickness benefits are a totally different category. If Sickness benefits are inadequate then address that – Not some policy that comes from Fantasy Island. Pity the Greens can not return to rectify issues around our environment instead of swallowing a few rats.

    • RedBaronCV 27.1

      Does anyone know if the GMI will also apply in households where one partner is well paid and the other has chosen not to work? I can't see this being very popular if it puts loads of epsom & remuera house partners on $15k a year when the household has millions coming in from other sources.

      • Pat 27.1.1

        abatement starts at around 750 pw partner income

        https://www.rnz.co.nz/audio/player?audio_id=2018752651

        • RedBaronCV 27.1.1.1

          They need to make very sure that this figure is out there or mischief will be made. but overall if it cleans up the earnings/ benefits mess at the bottom of the table it's a good call.

      • Herodotus 27.1.2

        I can see as per my reply 24.1.2.2 that an average person living in an average house with enough saved for a No Frills retirement would be captured by this tax.

        I await the detail, pity if this has been so well thought out why the detail did not accompany the announcement.

        • RedBaronCV 27.1.2.1

          Yep that was my rough read on the situation looking at Auckland and wellington house prices. They wind up paying tax on a basic service – the one house they do own. I'm not sure that these people are the "enemy" though. I'd be chasing down the offshore investor who speculates onshore or horrors looking hard at the migration settings

          . I'd definitely suspend the Investor category.(aka known as passport buyer category) who can pay their money then drag more of it on shore to buy up distressed assets and then make sure they are safely offshore again.

          • Herodotus 27.1.2.1.1

            It also "punishes" those in the 2 cities + The lakes Districts over the remainder of the country. As a 3-4 bedroom house fulfils the same shelter function, but due to the vagaries of property values (In particular the value of land) This proposed policy would have perverse consequences.

            There was nothing about indexing thresholds.

            I could not see from the release or video above if the increase in benefits will be "ring fence" protected from being offset by increase in rents ? And how will those in private tenancy maintain a similar financial position as a similar family fortunate to be in a state house ?

            • RedBaronCV 27.1.2.1.1.1

              Never mind the 3-4 bedrooms 2-3 will do you in in quite a number of places.

  28. UncookedSelachimorpha 28

    To answer Goldsmith's lie (if I have done my sums right):

    To pay $40,000 under the Green's proposed wealth tax, you would have $3.5m in applicable assets, not the $2m he said (so he was only out by a trifling 75% – glad he isn't in charge of anything important!).

    Will the tax be on individual (rather than couple) wealth only? If individual, a couple could collectively own up to $5m to attract $40k wealth tax.

    To people who think $3.5m is nothing, in 2018:

    Half of NZ households (not individuals) had wealth below $340k. Half of Pakeha individuals had less than $138k and Maori individuals, $29k

    People with $3.5m and complaining – forget just how much worse off most of NZ is!

    • Herodotus 28.1

      Don’t forget that the greens co leader said that they reduced the amount collected by 1/3 to be conservative, so if their numbers are true that this tax will collect over $4BILLION over and above what we are told is needed to cover the increase in benefits, and that doesn’t include the tax from valuing private businesses 🤪 perhaps there are a few who should check their numbers from both sides of the discussion 🤫

      • RedBaronCV 28.1.1

        I think the real issue is that they have unsettled a very large number of people all of whom have quickly calculated their own current or likely future situation and given it a thumbs down . As you said the thresholds seem to have been plucked out of no-where.

  29. sumsuch 29

    All for your green brown, Weka, after seeing birds keeping their heads down in between hedges in Westport. Or, my way of saying a vast tick before the 'footnoters'.

  30. Craig H 30

    One potential issue is house prices drop in response to wealth taxes as people don't want million dollar properties any more, so wealth taxes raise less than forecast.

    Overall though, I like it, and hope Labour comes up with something decent as well.

  31. A good reminder of why we need serious policy in this area. Inequality in NZ is at an unsustainable and inhumane level. Kiwis are going to die this winter due to shitty housing and energy poverty.

  32. David Mac 32

    I'm concerned it's a replay of last time without the media maelstrom. Of course we need to raise the lot of those that struggle but Kiwis didn't warm to moving up to the min wage last election.

    I think the string to this bow is best pulled back when sharing a green tea and muffin with Jacinda at the Beehive cafe.

    NZers en masse want to be able hang a rope over a river and bomb in without spending the following 3 days with an upset tummy. Few of us will bomb, it's having the option open that counts.

    Jacinda's mob are obliged to run centre left, there is territory for a party to prosper to their left. But geez, you catch more Kiwis with honey. I reckon, campaign with broad appeal in mind, win seats then from a position of strength lobby like hell for the heartfelt stuff.

  33. Foreign waka 33

    Yes, yes, yes. Finally a policy that looks 20 years ahead instead of cry wolf poor rich people BS.

    With focus not just on todays inequality but in years to come when robotics and automation, IT will impact the working people and leave many many without income. It is well known and all that "there will be new jobs not yet conceived" stories just shut the voices down that know that we need a rethink.

    Now where are those "uncompromising" young people wanting to make a difference?

  34. Maurice 34

    The Rural sector is already descending in to a "cash" economy … to avoid GST and slamming their wallets shut. This is the sector we all depend upon to 1) Feed us 2) Export our way out of the huge Covid debts already incurred. There is already local talk of "starving the Beast" and reducing production in reaction to the very thought of taxes on nominal "wealth" without underlying income to fund those taxes.

    Many are already repositioning their financial matters to minimise a tax which may – or may not – eventuate.

    This – plus the political push-back – is the result of making such policy announcements.

    • KJT 34.1

      Those in the rural sector who have such fantasies, will soon find out what happens without the support of the rest of us who actually pay the taxes they don't, to pay for the services and infrastructure they depend on.

  35. Kate 35

    looks like everybody is hyped

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  • Major milestone reached in Pike River Re-entry
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  • Iwi community hub opens in Murupara
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  • Spruce-up for Ōtaki community facilities
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  • Procurement to promote jobs, Māori and Pasifika businesses and sustainability
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  • Timaru’s Theatre Royal to be upgraded and new heritage facility built
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  • District Court judge appointed
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  • Approval given to Commercial Film and Video Production Proposal
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  • Supporting a thriving wānanga sector to benefit Māori learners
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  • New Zealand first in the world to require climate risk reporting
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  • Economic data highlights impact of Auckland moving out of Level 3
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  • PM statement on Cabinet COVID-19 Alert Level review
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  • Government joins forces with Central Otago communities to clean up waterways
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  • Join the one in a million reo Māori moment
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  • The Toloa Tertiary Scholarships for 2021 aims to increase Pacific participation in STEM
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  • Financial support for timber industry
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