Key proved himself bereft of ideas with his speech on Tuesday, and on Wednesday he showed himself to be out of touch. As you know, Key has voted himself $23,000 of tax cuts on his PM salary alone. Labour estimates another $60,000 on his investments – over $1000 a week. Key disputes Labour’s numbers, estimating his tax cut is ‘only’ $15,000.
Labour has been goading Key over his ‘thousand dollar a week tax cut’ since Parliament resumed. And yesterday, Key foolishly bit back saying:
“I am struggling with where the member gets a $1,000 a week tax cut from, because, without going into too fine a point, the last time I looked at the figure from the Remuneration Authority, I saw the Prime Minister of New Zealand earns $400,000 a year. The difference between the top personal tax rate, which was 38c in the dollar, and the new rate of 33c in the dollar is 5 percent, and 5 percent of $330,000 is about 15 grand.”
Oh poor Johnnie only gave himself a $15,000 a year tax cut, eh? Poor, poor Johnnie.
Hmm. Well, first that’s not very good maths for a money trader – 5% of $330,000 is $16,500. And Key hasn’t counted the first round of tax cuts he gave himself or the cuts on his income below $70,000. Add them in and the total tax cut that Key has voted for himself is $22,920 on his $400,500 a year PM salary.
Labour estimates that if he got just a 2% taxable return on his $50 million fortune (ie. another $1,000,000) then that’s a further $60,000 in tax cuts. A grand total $83,000 a year or $1,590 a week.
Oh and he pocketed a $7,500 pay rise this year. So, at least one person living it up on the public dime, I guess.
But, as with the Nats’ distorted net income figures (which count Labour’s tax cuts as their own, are based a skewed average, don’t count the GST hike, only count ordinary time pay for full-time workers, and don’t account for the unemployed), it’s not really the precise size of the tax cuts Key has given himself that matters. It’s certainly huge and unjustifiable.
The fact is that Key has voted for himself massive tax cuts that he did not need and he’s paying for it by cutting our services and selling our assets in a time when we’re back in recession and over a quarter of a million Kiwis are jobless. And now he adds salt to the wound by saying it’s a trivial amount, ‘only $15,000’
Talk about out of touch.
PS. If Key wants to make clear exactly how much of a tax cut he has given himself he could release his tax records like his good buddy Obama has to.
PPS. Oops. Some bad mental division – a 2% return on Key’s fortune is a million, making his tax cut $83,000 a year