National’s enormous tax hole problem

Written By: - Date published: 8:19 am, September 14th, 2023 - 115 comments
Categories: Christopher Luxon, Economy, national, same old national, tax - Tags:

The right has this belief that they are economic geniuses.  Their reason for being is that they will make the economy better.  The eternal question is who for, the answer tends to be for the rich and the rest of us can get stuffed, but their world view is of extreme importance to them.

Not all of them are rich.  But they all want to be rich.

Occasionally this belief is shown to be faulty.  Check out what Liz Truss did to the UK economy or what Rob Muldoon did to ours if you need proof.

And locally there is a growing belief amongst the media that National’s Foreign Tax policy calculations are hopelessly optimistic.

The policy was released two weeks ago and the questioning of the figures continues and has not abated.

National leader Christopher Luxon has tried to put the issue to bed but his uber confidence has not persuaded journalists.

You should listen to this Radio New Zealand clip where Luxon the trained talking robot said that the policy is rock solid and that he is really, very, absolutely confident about National’s figures.

Radio New Zealand hired two economists to look at the figures.  They concluded that about 700 sales at an average price of about $2.7 million could be achieved.  They calculate the tax raised would be in the vicinity of$210 to $290 million a year, not the $715 million promised by National in the first year.  And they point out the Costelia review of National’s figures appears to have been on the report itself which contains no calculations.

If National’s calculations are robust then National should release them.  Otherwise it can expect this issue to dog it for the rest of the campaign.

And a second large hole has appeared in National’s calculations.  It anticipated that $1.5 billion of the Carbon fund was immediately available to be reprioritised or squandered depending on your world view.  This was the figure for the fund in the Budget documents but the amount actually available is $1 billion.  Labour announced in August that $500 million would be applied to walking and cycling projects.  National clearly must have missed the memo.

Half a billion here, half a billion there, pretty soon we are talking about real money.

This is important because a billion dollar hole in Government’s budget would mean either increased debt or some pretty savage cuts.

And it goes to the core of National’s claim to be economic geniuses.  If they cannot get basic predictions right then they deserve to be roasted.

This issue is not going to go away.  And National is damned either way.  If it releases its calculations I anticipate that its inability to price policies will be laid bare.  And if it doesn’t then a sense of mistrust in what it would actually do will grow.

115 comments on “National’s enormous tax hole problem ”

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  1. Tiger Mountain 1
    14 September 2023 at 8:46 am

    Back in 2017 there was the infamous “Stevie’s hole” as Mr Joyce tried to sow doubt among voters about Labours handle on figures.

    https://www.nzherald.co.nz/nz/an-11-billion-hole-expert-analysis-of-labours-fiscal-plan-after-steven-joyce-called-it-a-fiscal-hole/LAT5BWLIDEFLZEHYF3KTKLKDAY/

    A majority of economists gradually revealed they did not agree with Mr Joyce, but the damage was done via the early blanket media channel coverage and various pundits felt that this Natzo tactic may have cost NZ Labour 2–3 percent of votes in the 2017 General Election.

    If National have been caught with their pants down re a fiscal blunder or deception–please Labour, Green & Te Pāti Māori–don’t let them get away with it on the campaign trail.

    • PsyclingLeft.Always 1.1
      14 September 2023 at 8:57 am

      please Labour, Green & Te Pāti Māori–don’t let them get away with it on the campaign trail.

      The "NZ wants tax cuts" BS being pushed by some on msm…needs major pushback. Nats can not fund tax cuts..without major cuts to NZ essential services.

      Solidarity on Left. Because divided..NAct rule.

    • William 1.2
      14 September 2023 at 10:23 am

      And just three years ago, let's not forget Paul Goldsmith's fiscal hole in 2020.

  2. Ad 2
    14 September 2023 at 8:49 am

    Castalia have not covered themselves in gold here.

    Willis is just getting away with trite bromides.

    Good on Hipkins for going on the attack on this. We have needed a lot more from Robertson.

    • Kat 2.1
      14 September 2023 at 9:12 am

      The media are just letting Willis get away with her spin by all this regular positive coverage:

      https://www.stuff.co.nz/national/politics/132934574/nationals-nicola-willis-promises-cuts-by-christmas-happy-to-work-with-david-seymour

      It’s all going to be rosey kids, everyone will be going out to the movies by Christmas………

      • PsyclingLeft.Always 2.1.1
        14 September 2023 at 9:58 am

        And real icecream ! Huzzah……

        We must get pushback moving on her and other NAct BS.

      • Clive Macann 2.1.2
        14 September 2023 at 10:27 pm

        Except for the 15,000 Govt workers that Seymour will sack on day one.
        No movies for them.

        Asked by Tame how many government jobs ACT's spending reduction plans would cut, Seymour said it would go from 62,000 full-time workers to 47,000, the same number there were in 2017.

        "To be clear, you are going to make 15,000 people redundant immediately?" Tame asked.

        "Yes," Seymour said.

        • Incognito 2.1.2.1
          14 September 2023 at 10:47 pm

          He’s channelling Trump.

        • Michael P 2.1.2.2
          15 September 2023 at 2:05 am

          Too be fair he's not sacking them, their positions will be made redundant. It's obviously not good for those out of a job, although I'm sure that having been government employees they would have been on high incomes and probably have redundancy clauses.

          But if government can function for New Zealanders without these positions then it is the right thing to do. You'd have to assume they're not essential roles.

          If for example their salaries are $80,000 (Pure speculation as I have no idea what these jobs pay rates are. However I think that if anything 80k would be on the low side) Then that's 1.2 billion per annum which is not an insignificant amount.

          • Incognito 2.1.2.2.1
            15 September 2023 at 8:47 pm

            You’d have to assume they’re not essential roles.

            Who said anything about ‘essential’? Seymour simply wants to slash the number to what it was in 2017. That’s his sole reasoning, if one can call it that. His thinking is that the market should step in and fill the hole.

          • weka 2.1.2.2.2
            15 September 2023 at 9:15 pm

            don't know how often you have to engage with a government department, but many are chronically understaffed.

            • Ad 2.1.2.2.2.1
              15 September 2023 at 9:34 pm

              Let's do a list, the same list that Labour and National are requiring, which goes: which Departments and Entities could lose a few pounds?:

              – MoD

              – DPMC

              – ERO

              – GCSB and SIS

              – MPI

              – 8 different entities inside MBIE

              – MoH including a few bullshit "authorities" in there

              – OHousing and Urban Development. Waste of time.

              – All of MoT

              – All the Departmental Agencies

              – The 3 Interdepartmental Executive Boards

              – 6 entities inside NZDF

              – easily axe 20 Crown Entities and no one would notice

              – same with at least 10 Crown agents

              – easily take out and merge 10 autonomous Crown Entities

              – no problem crunching another 10 independent Crown entities, with a bit of crunchy legislation

              – Definitely no reason to have Crown Research Institutes when they should be merged into universities as specialties

              – Moosh together a dozen Public Finance Act Schedule 4 entities.

              And each of the above attracting consultants every time there's a reform or a legislative change, at $200 an hour minimum.

              Just getting started. A whole lot of bullshit gravy train boards doing fuck all. This is what you get with an over-regulated country that sucks its best minds into Wellington and actually extracts creative minds and global experts into circle-jerk low production nonsense that the Ardern government generated for far too long.

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

              An ACT Party with its mojo working will not find their task difficult. Labour could and should have done the same thing.

          • Ad 2.1.2.2.3
            15 September 2023 at 9:16 pm

            There is a whole Wellington consultancy layer to burn through first, and they frankly have enabled fuck all to happen for too long in this goverment. If anyone can remember back to the millions the Ardern first term was burning through.

            Remember, every time you reform something, you attract flocks of $200-per-hour consultants.

            After that the next government can go merge some of the multitude of bullshit boards governing everything from the Walking Commission to the Boards of crown research entities.

            Plenty of fat to purge in Wellington ATM.

  3. Tony Veitch 3
    14 September 2023 at 8:53 am

    either increased spending

    Surely you mean decreased spending?

    [Oops I meant increased debt. Now corrected – MS]

  4. tsmithfield 4
    14 September 2023 at 9:42 am

    The problem doesn't really exist. It is all based on assumptions anyway. The nature of assumptions and projections are that the outcomes are never known in advance, and a variety of factors could mean targets are missed or exceeded.

    Who knows, the pent up demand and house price inflation may mean the assumptions are met. Time will tell on that.

    However, if the assumptions prove incorrect, then all that is required is for settings to be adjusted. For, instance, the home threshold might need to be dropped to say $1.5 million.

    Or other sources of revenue might need to be found. For instance, a surcharge could be placed on vapes, which have become a problem in themselves over recent years, especially for youth who have never been smokers, but take up vapes as a new habit.

    • Barfly 4.1
      14 September 2023 at 10:21 am

      lol TS a NACT government based solely on past observations will

      Cut Welfare, Education and Health by progressively underfunding them in relation to inflation and population growth.

      Asset Sales if they can sell it they will.

      Will you be happy with that outcome TS?

    • AB 4.2
      14 September 2023 at 11:08 am

      You may be right TS. There's maybe something to be said for regarding economic policy as a species of relaxed experimentation and agile learning and self-correction. Likewise we might regard economists as medieval scholastic cranks who have invented non-existent, arcane and mysterious 'forces' that explain why things happen.

      It would be fun. But remember, if the Nat-ACT wide-boys are allowed to do that, then so can everyone else. Nat-ACT are not posssessors of a particular kind of genius that means only they can get away with it.

      • tsmithfield 4.2.1
        14 September 2023 at 11:23 am

        The point is that all projections going forward are based on assumptions. If those assumptions are not met, then there needs to be contingency built in to adapt so that budgets are met.

        Rather than trying to point out holes in National's assumptions, it would be more productive to ask them what they will do if those assumptions are not met. Since this is a possibility in any forward projections, it is good planning to have contingencies included in the plan.

        When I am planning budgets I usually include three scenarios, optimistic, realistic, and pessimistic. Plans for expenditure are developed accordingly, so that adjustments can be made, depending on which scenario is most likely to eventuate in reality.

        I would expect, National, or any other organisation would take a similar approach in their planning. So, answering the question should not be too hard.

        • Blazer 4.2.1.1
          14 September 2023 at 11:29 am

          Very good…so your 3 scenarios are-reality,optimistic ,reality and pessimistic…reality?

          • tsmithfield 4.2.1.1.1
            14 September 2023 at 11:40 am

            In my years in business I have all three scenarios play out. And it isn't always clear what will happen going forward.

            For instance, there may be some large tenders that have been quoted that make a material difference to the outcome for the year. An optimistic scenario may be that all or most of the tenders are accepted. A realistic scenario might be say half are. A pessimistic scenario might be that a few or none are.

            The thing is that it is very difficult to predict what will happen in reality. But each scenario will require different requirements for staffing etc. So, planning for contingencies is very important.

            I imagine the complexities of planning budgets for government expenditure will be far more complex than anything I deal with. So, contingencies in planning will be even more important.

            • bwaghorn 4.2.1.1.1.1
              14 September 2023 at 12:58 pm

              So, contingencies in planning will be even more important.

              Na just make shit up ,and tell everyone to just trust you!!!

              Unless your contingency is so nasty you don't want people to know.?

            • Incognito 4.2.1.1.1.2
              14 September 2023 at 9:17 pm

              Governing the country is not like running a business (or a household, for that matter). Socio-economic policies are much more than preparing budgets and balancing the books. Not to mention the ethical issues and moral dilemmas, fairness & inequity, justice, and planning for future generations, etcetera.

              Only the Nats and ACT will try to run the country like a (corporate) business, which is why they always leave such a mess, every time.

        • AB 4.2.1.2
          14 September 2023 at 11:47 am

          The questions about what alternative sources of revenue they would substitute have been asked – but not answered. Most likely because the answers are unpalatable to the public and they may in fact be National's real goal here.

          Luxon's response has been a cast-iron assertion that no Plan B is required. Perhaps you should join his team and inform him that your approach is to have a Plan B and Plan C? Though in my opinion, Plans B and C certainly already exist and they are the things that National would really, really like to have as Plan A.

          Interestingly, Key's evasive response in similar situations was to say he was "relaxed". That was good enough for many people, because they thought he had made a lot of money in 'business' (if currency speculation meets whatever the definition of business might be these days) and so assumed he knew what he was doing.

          • tsmithfield 4.2.1.2.1
            14 September 2023 at 11:55 am

            I think that National would really like to get rid of the foreign buyers restriction altogether. So, it wouldn't surprise me if that got the chop if there wasn't enough sales above $2 million. Then tax could be levied on all sales to foreigners.

            So, it wouldn't surpise me if this is one of the contingencies.

            • Barfly 4.2.1.2.1.1
              14 September 2023 at 12:00 pm

              Woot tenants in our own land time!

              • tsmithfield …
                14 September 2023 at 1:32 pm

                We sort of are already, aren't we? Where does most of the money come from we use for borrowing to buy houses etc? And, kiwis would have a price advantage under a foreign buyer tax scenario because the foreign buyers would need to factor tax in.

                I think the whole foreign buyer thing was a bit of a beat up anyway. I think it was around about 3% of houses being sold to foreigners in most areas. And, the ban didn't seem to do much about slowing house price rises either.

                Personally, I think people should be able to sell their houses to whoever they want to without the government sticking its beak in.

                Anyway, I won’t go down this line of discussion too much further lest I am derailing the thread.

    • Michael P 4.3
      15 September 2023 at 2:08 am

      A surcharge on vapes? Why not just shift some of the tax burden from work to wealth?

    • SPC 4.4
      15 September 2023 at 2:23 am

      The ACT Party want to sell 49% of the remaining SOE's – KiwiBank, KiwiRail, NZPost etc – a by design fund to cover the shortfall in the National Party first year budget.

      The reason for $2M is because the median and or average is at c $1M Auckland RC area and Wellington City – to avoid impact on the domestic market price.

  5. Blazer 5
    14 September 2023 at 9:44 am

    Nationals great,gaping hole will not matter ,regardless….'we inherited a mess from…Labour…far worse than we thought'!

  6. barry 6
    14 September 2023 at 9:52 am

    National haven't had a numerate finance spokesperson since Bill English.

    I doesn't matter – they will just increase GST to 20% and say how good they are as economic managers.

  7. Roy Cartland 7
    14 September 2023 at 10:29 am

    The cat is out of the bag.

    They're either bullshitting or grossly financially incompetent. Both are disastrous.

    https://www.rnz.co.nz/news/election-2023/497974/economists-analysis-rubbishes-national-s-foreign-buyers-tax-numbers

    • Barfly 7.1
      14 September 2023 at 12:02 pm

      IMO they know it will never be enough but are lying because the cuts to services they plan to get the $ would horrify the voters

  8. Kat 8
    14 September 2023 at 10:30 am

    I heard a few emails/texts being read out on Morning Report today, perhaps RNZ needs a curry up with a flood of incoming correspondence demanding they hold National/Act to 'real' account. The questions being asked so far are weak and allow Luxon and Willis to just keep repeating the script. Say it often enough and people will believe it.

    Imagine if Labour not only had a tax hole the size of Nationals, but refused to publish any modelling to back the workings……….the media crucifixion would be in technicolour….

    • Anne 8.1
      14 September 2023 at 11:05 am

      As I have long suspected:

      strip away the outer layers, and Christopher Luxon comes across as no more than a political version of a snake oil salesman. As for Nicola Willis… she hasn't started very well has she! God forbid what state the finances will be in if she is at the helm.

      • AB 8.1.1
        14 September 2023 at 11:13 am

        The more I listen to Willis, the more I feel that inflicting pain on the unworthy is actually the point – not an unfortunate and easily forgotten side-effect.

        • PsyclingLeft.Always 8.1.1.1
          14 September 2023 at 11:34 am

          Willis was a senior advisor to John Key….and never mind the "real ice creams and movies" tax cut crap…IMO a potential Ruthless Ruth Richardson wannabe.

    • tc 8.2
      14 September 2023 at 12:37 pm

      Reading out texts and emails rather than do some actual journalism and hold team NACT to account sums up RNZ.

      • In Vino 8.2.1
        14 September 2023 at 6:40 pm

        Yes, and they burble on about how they love our (?) ‘feedback’.

        Good public Radio being deliberately degraded to commercial babbleback, with annoying promotion ads being blared at us after every news time – which they have increased to every 30 minutes so that they can do even more self-promotion cacklemush.

  9. observer 9
    14 September 2023 at 11:21 am

    Thomas Coughlan provides a detailed round-up of economists' analysis in the Herald:

    Election 2023: ‘Beyond comprehension’ – modelling shows $2b hole in National’s foreign buyer tax – NZ Herald

    Luxon responds: "I've given you what you need to see". Breathtaking arrogance.

    Opposition leaders don't need to worry about the OIA. Now imagine a PM responding like that while the OIA requests pour in … he wouldn't last five minutes.

  10. fisiani 10
    14 September 2023 at 12:09 pm

    National will deliver you tax cuts. That's the message the people and the voters are hearing.

    Squabbling economists are just noise.

    • PsyclingLeft.Always 10.1
      14 September 2023 at 12:14 pm

      National will deliver you tax cuts. That's the message the people and the voters are hearing.

      Yeah, but its all BS based on lies. Which the Economists…detail.

      • James Simpson 10.1.1
        14 September 2023 at 5:22 pm

        Bullshit?

        Do you seriously doubt that they will cut taxes?

        • observer 10.1.1.1
          14 September 2023 at 5:36 pm

          Of course they will cut income tax (though not equitably).

          The "BS" is how they are paid for. Their answer is – by inventing sources of money.

          So, not paid for at all. And therefore, actually paid for in ways they will not tell us: cutting basic public services.

          This is worse than a policy of selling assets or privatising, or even raising GST, because then the voters can decide if they want to make the trade-off. National's BS is that there is no trade-off at all. We keep everything, and also get free money, magic money.

          That's the BS.

          • Barfly 10.1.1.1.1
            14 September 2023 at 6:46 pm

            The National Party's magic money and magical efficency tree they claim to be able to cut 100's of millions of $ without reducing services . FFS! Can I sell you a bridge?

        • PsyclingLeft.Always 10.1.1.2
          14 September 2023 at 7:20 pm

          Lol..they gotta get there first. And the way they are getting ripped about their tax plan….?

          How the fuck they going to fund tax cuts? What..are they going to lie about now?

          • James Simpson 10.1.1.2.1
            15 September 2023 at 9:01 am

            The PREFU showed the expected deficit for the 2022/23 year ballooned to $11.4 billion from the previous forecast $7.6b

            The current government is borrowing billions more than they told us they would at May's budget to meet their spending promises.

            Why are you worried about National's potential half billion gap, but have nothing to say on the government's 4 billion.

    • observer 10.2
      14 September 2023 at 1:10 pm

      Perfect summary of The Big Lie. Thank you for exposing it.

      If people believe the earth is flat, therefore it is flat.

      Squabbling scientists are just noise.

    • Blazer 10.3
      14 September 2023 at 5:25 pm

      Yes a carbon copy of Liz Truss' policy…tax cuts and grow the economy…ridiculed in the U.K…will voters in NZ ..buy it?

  11. SPC 11
    14 September 2023 at 12:11 pm

    Just maybe Labour does not have an opposition but team grifter – versions National, ACT and NZF … imagine being WP and knowing that by deciding to oppose the return of Labour, he is on track to install team grifter, with the help of opponents of pandemic mandates.

  12. Barfly 12
    14 September 2023 at 1:05 pm

    National’s Tax Cuts

    "National has deflected concerns about the legality of the plan, with former IRD deputy commissioner Robin Oliver saying the plan would be able to comply with New Zealand’s tax treaties."

    Well someimes it's not the minutae and really small print that matters sometimes the really important thing is how it's perceived – If the Chinese Government decide that National are being smartarses with their 15% money grab I can easily see New Zealand developing a humungous problem exporting to China with customs/ food safety /.documentation and accreditation problems mysteriously developing and completely Donald Ducking oh say milk powder exports……Do stupid shit win stupid prizes.

  13. psych nurse 13
    14 September 2023 at 1:14 pm

    Maybe National plans to get around the tax treaties by imposing a 15% sales tax on all property.

  14. observer 14
    14 September 2023 at 1:30 pm

    There really is no point trying to analyse National's "plan" as if they had one. That is the problem with so much political commentary. It assumes good faith, when there is none whatsoever.

    All that matters (to them) is winning. Do whatever it takes, say whatever you want, just get into power.

    After that there will be "events", which might be anything. A war, a global economic downturn, a natural disaster, a saucy scandal. A government is then judged 3 years later on how they handled the "events".

    Everyone know this, surely? National's strategists certainly do. That's why they lie. If you have no morals, no vision, no conscience, then it's easy.

  15. tsmithfield 15
    14 September 2023 at 2:29 pm

    It does all depend on the assumptions used. This is pointed out in a article in the Herald about the alleged hole.

    From the article:

    A spokesperson for Castalia said that the three economists’ “critique assumes that the removal of the ban will lead to a negligible number of investment transactions”.

    “In our view, this requires a belief that foreign buyers have been deterred from the New Zealand market by factors other than the ban. Castalia agrees with National’s assessment that return to previous trends is more likely to be accurate,” they said.

    “National’s modelling is based on the experience New Zealand had before the ban. We reviewed this modelling with reference to foreign buyer taxes in other jurisdictions, including Ontario, British Columbia, and Hong Kong. Our review included modelling of the reduction in purchases due to the imposition of the new tax. Hence, we believe the forecast number of sales to foreign buyers in National’s tax plan is reasonable and supports the overall revenue forecast in the plan,” they said.

    So, it appears the three economists have assumed there will be negligible interest from foreign buyers in their assumptions, whereas Castalia, who reviewed National's assumptions, believe that sales will return to previous trends.

    • Blazer 15.1
      14 September 2023 at 5:11 pm

      Castalia would be a front runner for 'consultancy fees' in a NACT…Govt…I guess.

      Oh,my bad..the Natz are going to reduce consultancy fees..like this

      'Some government departments have tripled their spending on consultants during the National Party's time in power, despite assurances from the Government that it was not depending more heavily on contractors'.

      Spending on consultants rises under National – NZ Herald

    • Michael P 15.2
      15 September 2023 at 3:44 am

      "…have assumed there will be negligible interest from foreign buyers…"

      I'm not an economist but to me it seems obvious that if you're a cashed up foreigner then buying property in Auckland would be a no brainer.

      Over the last 30 years property prices in Auckland have increased 7% per annum. At that rate you'd be even after a couple of years and then it's all capital gain from there.

      Further, if you agree with many that the market has stopped going down and is now going to head back up then it could easily go up at a much faster rate than 7% if there is a sudden an influx of buyers.

      Let's face it, if you're a cash buyer, then over the medium and long term, you can't lose on residential property in Auckland. It's also a very safe investment because of our stable, democratic rules based political system, not to mention it looks like the next government will be one which will enact policies that very much favor property speculators. At the very worst, the government can (not easily) force you to sell to them, but they have to pay you a fair market price.

      The only way to lose would be if (and it's such a big if that it's pretty much a 'not going to happen.') there was a massive crash in the market. The only way that can happen is if the government enacts policies designed to drastically lower house prices (which no NZ government will do) or if residential property in Auckland suddenly becomes extremely undesirable as somewhere to live or as an investment. (Can't see that happening)

      Possibly in about 2045 (don't quote me on that I remember reading it somewhere but can't remember where and can't find it again) which is the forecast year where there will be more renters than home owners in NZ is when there might start to be a meaningful change in the market (in terms of affordability). If more voters are renters than owners then they have considerable political power if they decide that house prices and home ownership are their priority issues. Once renters are greater than 50% of voters only then will politicians listen in my opinion.

      Just as an aside I had an interesting chat with a friend this arvo about inequality and asset ownership / wealth. Assuming that the current economic system we live under isn't really going to change much anytime soon, (which is reasonable to assume). So a higher and higher proportion of all the wealth will continue to funnel into a smaller number of people's hands. Let's say The top 10 percent at the moment own 50% of the wealth. (the numbers accuracy doesn't really matter for this exercise)

      Continuing in the same general direction of increasing inequality means that at the extreme 'other end' one person would own all of the wealth and everyone else would own nothing. I think that there has to be a tipping point (revolution) but wonder what level do we have to get to before people finally decide that enough is enough? Will it be for example when 10 percent of the people own 50% of the wealth (could be now!) or when 5% own 80% and so on..?

      Will the people rise up first or will it get to a level where those who own all or most of the wealth have the means to initiate a police state acting to protect them and their wealth from the people? If the system isn't radically changed at some stage I can easily see a critical mass of people looking at how so few own so much and doing something about it. Otherwise at some stage in the future we will end up with one person owning the world… devil

  16. observer 16
    14 September 2023 at 2:31 pm

    Everything you need to know about Luxon, in a nutshell –

    "Luxon said the Labour government was trying to discredit the plan which was “disappointing”.

    The press conference is surrounded by National party supporters who are not happy that Luxon is being asked questions on the plan.

    The supporters are heckling journalists as they ask questions, with National staffers trying to calm them down."

    (italics added)

    If you can't see what he is by now, it can only be because you don't want to.

    Link is to live blog so will be updated …

    Election live: Luxon asserts Nats' tax plan 'rock solid' (1news.co.nz)

  17. newsense 17
    14 September 2023 at 4:14 pm

    The headlines need to hammer home- it’s not a $500 million hole- it’s a $500 million dollars A YEAR every year. https://www.newsroom.co.nz/nationals-foreign-buyers-tax-falls-500m-short-says-economists-review

    And as Gordon Campbell points out one lie covers another- there is no over spending, there is no vast excessive waste. Look at the debacle that happened in the past with Paula Bennet. They found nothing to cut, but were given a bunch of free publicity to a lie. Fool us twice and you’re a collaborator, media.

  18. PsyclingLeft.Always 18
    14 September 2023 at 4:21 pm

    Willis : You are all wrong. I'm right. And I'm… gonna stamp my feet.

    Independent economists claim there would be a multi-million dollar hole each year because there's no way enough houses – costing more than $2 million and taxed at 15 percent – could be sold.

    https://www.rnz.co.nz/news/political/497995/election-23-nicola-willis-hits-back-over-economists-doubts-on-national-foreign-buyers-tax-numbers

    • newsense 18.1
      14 September 2023 at 4:25 pm

      And despite RNZ leading this Willis’ response is now the only thing in their home page, reinforcing the Nats framing as the correct one. Cowards and propagandists.

      • PsyclingLeft.Always 18.1.1
        14 September 2023 at 4:45 pm

        Yea, I to, wonder at some of this. What's the angle? I'm careful to look…but would most people?

        RNZ can be a bit of a Curates egg…..

        Have to say..I went off Wallace Chapman…years back (IMO bit too much of a smart ass !), but he seems to have got worse ? Time for some new input ?

        Anyway…Labour, Greens, and Te Pati Maori really need to get the game faces on….and keep pointing out NActs lies.

        Sadly, "some" NZ media are not going to give up the attack lines on the Left.

  19. newsense 19
    14 September 2023 at 4:22 pm

    Everywhere Luxon and Willis go they need to send pantomime ballifs to collect the money they need to pay for the tax cuts.

  20. georgecom 20
    14 September 2023 at 5:12 pm

    The great Nicola Willis Tax Cut quiz. Will you

    A. Borrow between $500 and $750 million to cover your tax cut fiscal hole?

    B. Borrow between $750 million and $1 billion to cover your tax cut fiscal hole?

    C. Borrow more than $1 billion to cover your tax cut fiscal hole?

    D. Who cares you are just desperate to be elected to government

  21. Drowsy M. Kram 21
    14 September 2023 at 5:43 pm

    So the NAct plan is to sell houses to balance the books – sounds productive, and it's certainly a good fit to the property-owning expertise of Willux.

    Suggest NAct get their real estate mates to set up a task force to identify 2000 high-value properties per year in high-risk areas (flood plains, sea fronts, cliff-tops, seismic hazard zones) and negotiate with owners to prioritise these properties for sale to wealthy foreigners. After all, you'd have to be stark raving bonker to sell off the good silver at a time like this – wouldn't you?

    Imho the Willux plan is a rock solid spoof. Forgotten Silver anyone? How times change.

    50,000 homes open for purchase by foreign home buyers under National's plan

  22. the other pat 22
    14 September 2023 at 6:26 pm

    why is it that ANYONE thinks that selling off your country is good fical/economic policy !!!!

    • Blazer 22.1
      14 September 2023 at 6:35 pm

      Yes I fear,NACT's hidden agenda is massive privatisation and asset …sales.

      The Key Govt just ignored the referendum results on p/p energy assets.

    • Michael P 22.2
      15 September 2023 at 4:22 am

      Yep. Any house that a foreigner is allowed to buy is a house that a New Zealander can't call their home. Some might see that as xenophobic but what's the point of being a NZ citizen or permanent resident if you are unable to have a place you can live in and call your own, but foreigners can buy houses here with the sole purpose of making money from them?

      In my opinion residential property should be for Kiwis to live in. The only reason a foreigner would buy a house here is to make money. As an aside, I would ban residential property ownership by companies as well. (with obvious exemptions for landlords). The only reason why a company (other than landlords) would own a residential property would be to make money from it either through tax advantages or capital gains,

      Houses should be for people to live in, not for making money from. If you want to buy a house here then by all means become a citizen or resident, buy a house and come and live here, otherwise you shouldn't be allowed to buy residential property..

      Foreign buyers should be allowed to invest in commercial property only, which can benefit NZ.

      This labor government has had years as a majority government, they could have enacted radical changes to make huge positive gains for those on lower incomes and those with no wealth without needing support from other parties. I see it as such a wasted opportunity from a bunch of cowards angry Now it looks like we're going to get a considerably worse lot (for the working class) in office for at the very least 3 years…. (sigh) sad

  23. Ed1 23
    14 September 2023 at 6:50 pm

    Are we really, really clear on just what is proposed by National? Above there are comments that relate to land, to houses, and to properties. Would a sale of 42m worth of "State Houses" come within the policy? The group that may be attractive to private buyers may be those where rents at at or close to market – they could be sold with no restrictions on rental agreements other than laws for private rentals. Then there may be a category were rents are moving over time to market levels – they may be sold with temporary rent restrictions so problems are clearly nothing to do with National when decisions to increase rents are made – some buyers would see the upside in future value. Would a new apartment building with between say 15 and 25 units be able to be purchased by an overseas entity? A representative of the buyer could be employed to manage the property . . . Could a private landlord sell $2 million or more value of current rental houses to an overseas entity?

  24. Mike the Lefty 24
    14 September 2023 at 7:45 pm

    National seems to believe that they are so far ahead in the polls that they don't have to prove anything, they can just coast to the line with any claptrap.

  25. SPC 25
    15 September 2023 at 2:15 am

    15,000 immediately made redundant before Christmas.

    Is that pretty legal, as to time of notice? Does it not come with some redundancy cost, in the first year? Is there any cost in terms of helping those made redundant with access to other jobs, counselling and training?

    https://www.employment.govt.nz/ending-employment/redundancy/

    • SPC 25.1
      15 September 2023 at 3:47 am

      Will someone in National inform Seymour that his NACT plan sounds like a criminal conspiracy (is not even pretty legal).

    • Michael P 25.2
      15 September 2023 at 6:25 am

      "Is that pretty legal, as to time of notice?"

      In my experience yes, as long as it is a genuine case of the position the person holds being disestablished and as long as any redundancy clauses in the employment contract and employment law are adhered to.

      The minimum notice would be a pay period usually at least 2 weeks if nothing stipulated in the contract but you'd have to be a shit employer too give 2 weeks notice (unless it was a case of the business failing otherwise) But any decent employer will give as much time as they possibly can and support the employee as much as possible through the process. A good employer would never make an employee redundant just before Christmas what an arsehole of a thing to do.

      On that very point my dad years ago very nearly sat one R Brierly on his backside. Brierly's had taken over Winstones (of which Dad was I think General Manager / Director at the time.) Brierly told Dad he had to make around 40 i think employees redundant less than 2 weeks before Christmas. Dad told Mr Brierly no and where he could go, in very colorful language and fisticuffs nearly ensued. Lucky for Brierly no punches were thrown.

      Some of the employees he wanted dad to get rid of had been with the company their whole working lives of 40 plus years and Brierly couldn't care less. What an arsehole. Of course it turned out Brierly was a deviant and was imprisoned over child pornography, another clear sign of no empathy or thought for others

      When Dad did make these people redundant in the New Year I'm certain he ensured they were given the maximum entitlement and benefits he could possibly arrange for them but said it still gutted him. Brierly stayed well away from Dad for

      I've been in the position of having to fire people in the past (That was because of their bad behavior rather than redundancy but was still really difficult. Anyone who has normal decency, normal empathy and has had to tell people they no longer have a job will tell you this is the most difficult, stressful and soul destroying thing they've ever had to do in business.

      However, anyone who happily blurts out in public that he's going to sack 15,000 people just before Christmas, is a psychopath….100%

  26. tsmithfield 26
    15 September 2023 at 8:53 am

    It has occurred to me that the current attempts by Labour to discredit National's tax policy is likely to be counterproductive. The reason I say that is that it is effectively keeping it front and center in voter's minds that National is promising tax cuts. Hence, this could end up being free advertising for National. As the saying goes, any publicity is good publicity.

    • Blazer 26.1
      15 September 2023 at 9:15 am

      One of your dumber ideas smithy.frown

      They need to be hammered to justify how they will pay for cuts.

      Why are they so determined not to reveal their modelling?

      • tsmithfield 26.1.1
        15 September 2023 at 9:46 am

        What they have released seems to have been sufficient for economists to comment on it. So, what more do you want?

        The main bone of contention seems to be whether the projected sales of homes to foreign buyers is realistic. Enough of that seems to have been released for there to be an argument over whether the projections are realistic or not.

        Even HDPA thinks the Nats figures around house sales are wrong. And she is about as right wing as Hosking. But she also thinks that voters don't care. If that is true, then Labour is giving National free advertising by banging on about the tax cuts.

        • Blazer 26.1.1.1
          15 September 2023 at 9:50 am

          I will spell it out for you.National claim to be a 'safe pair of hands'…good economic managers.

          People want their modelling costings ,assumptions and conclusions to ascertain how credible their claims for funding tax cuts are.

          Why do you think National steadfastly protect their calculations from…scrutiny?

    • observer 26.2
      15 September 2023 at 1:54 pm

      As the saying goes, any publicity is good publicity.

      If that were true, Labour would be at 90% in the polls, given all the headlines this year about Ministers stuffing up in various ways.

      But the opposite is true. National have gained support simply being the "Change", "Other", a blank screen for grumpy voters to project onto. Very little publicity about anything they would actually do, until the campaign began last month. There's a very good reason why they refused to front up on their finance policies and numbers, all year.

      In any case, everyone knows that every 3 years National promises income tax cuts (the shorthand "tax cuts" is common but inaccurate, because they raise other ones, always). Even if there was a news blackout everyone would still know.

      As for the political tactic, you only have to see Luxon's response to questioning to see that it works. He hates being challenged, he has the thinnest skin and always – yes, always – resorts to bluster. Remember that for most voters (i.e. not on political blogs) Luxon has been unknown and unseen. They are finally getting to know him. A month may not be enough time, but it is absolutely right to show the voters what he is.

      • tsmithfield 26.2.1
        15 September 2023 at 2:49 pm

        If that were true, Labour would be at 90% in the polls, given all the headlines this year about Ministers stuffing up in various ways.

        I guess the saying is a heuristic rather than an immutable law. So, yes, there will always be exceptions to the rule I expect. In the case of tax cuts, if the electorate generally is really wanting the tax cuts, then I expect the "any publicity is good publicity" heuristic would likely apply.

        As for the political tactic, you only have to see Luxon's response to questioning to see that it works. He hates being challenged, he has the thinnest skin and always – yes, always – resorts to bluster

        I agree. He needs to change his approach there. I think the questioning about tax cuts would stop if he simply answered each query with a soundbite "thanks for the opportunity to talk about tax cuts again. And, yes, we can confirm that tax cuts are coming exactly as promised."

  27. Herodotus 27
    15 September 2023 at 3:23 pm

    Dear Grant please sort out your $13.4billion hole “the bond programme has been increased by a further $9.0 billion to fund the cash shortfall. Overall net debt is expected to be higher than previously forecast by $13.4 ” your hole took only 2 months to be created, that was well modelled !! So if The $2 billion hole in National's costings is the equivalent of paying for about 3800 senior nurses, 4000 teachers or 2700 police every. What is the consequences of $13.4 billion

    and to Nicola do the same to your $2billion hole 😱

    I know what hole I would reluctantly be in

    how well we are served and how we are held back by a lack of critical thinking !!!

    https://www.treasury.govt.nz/publications/efu/pre-election-economic-and-fiscal-update-2023

    https://www.newshub.co.nz/home/politics/2023/09/election-2023-grant-robertson-slams-christopher-luxon-nicola-willis-rubble-claims-of-rock-solid-tax-plan.html

    • Incognito 27.1
      15 September 2023 at 7:11 pm

      […] that was well modelled !!

      Indeed, it was, and that is the point. In response, the Minister of Finance has instructed department heads to find $4B in cost reductions and its plan and projections are clearly laid out in the PREFU.

      In contrast, National’s model is and remains undisclosed and its underlying assumptions have been seriously challenged. Their whole ‘policy’ is hot air that smells of desperation and incompetence. I wouldn’t want those shambolic performers anywhere near the Treasury benches.

    • SPC 27.2
      15 September 2023 at 7:50 pm

      Yeah na.

      The difference is that PREFU was about the consequences of monetary policy tightening – declining government revenues.

      Yet given plans for reduced discretionary spending a future surplus could be forecast

      As a result, the OBEGAL deficits are expected to narrow in the near-term and return to surplus in the 2026/27 fiscal year, one year later than shown in the Budget Update.

      National's hole is related to a poorly costed so called tax neutral plan.

      Do you have an interest in a rental property to declare?

  28. tsmithfield 28
    15 September 2023 at 3:47 pm

    Part of the issue with some of the criticism of National's policy with respect to tax income from house sales is that the comparator figure that critics reference is often extremely pessismistic. For example, in this article the economist referenced the previous twelve months as justification for dismissing National's projections. But the economist is either an idiot or is being deliberately misleading. From the article:

    Eaqub said the potential tax revenue from all properties over $2 million in New Zealand would be $1 billion based on the past 12 months. This means more than 70 percent of $2 million-plus properties would have to be sold to foreigners.

    But the last twelve months included the biggest sales slump in the last 40 years. So, using the last twelve months as a predictor going forward is highly misleading.

    • Drowsy M. Kram 28.1
      15 September 2023 at 4:01 pm

      So, using the last twelve months as a predictor going forward is highly misleading.

      So, what are the Nat pollies – those economic wizards – using as "a predictor" for their estimated annual tax take from the sale of Kiwi properties to wealthy foreigners?

      I don't understand why Willis, Luxon and co. are being so coy about this. Why won’t / can't they show all their working – it's not rocket science!
      Maybe it’s ‘commercially sensitive’ wink

      • tsmithfield 28.1.1
        15 September 2023 at 4:12 pm

        Probably they could release the comparative period they are using.

        I would be interested to see how it stacks up if the comparative period is prior to all the funny money pushing the house prices up, and adjusting that for inflation to get an idea how many house sales would be in the target bracket under normal market conditions. That would be a more realistic comparator to use.

        If the Nats are relying on the sales data when the market was going bonkers, then that would be just as bad as the using the last twelve months as a comparator. So, yeah, knowing what comparative figure they are using would be useful.

  29. newsense 29
    15 September 2023 at 4:58 pm

    Show us your costings!

  30. Charlotte Rust 30
    16 September 2023 at 8:04 am

    Aside from the fact that they are banking on hypotheticals I am vehemently against foreign buyers purchasing our existing housing stock full stop. I don’t own property, would dearly love to but can see that opportunity bolting further away with this frankly unpatriotic policy. The notion it won’t raise house prices is ridiculous and Willis is either naive to the extreme or disingenuous – the later I’d say. Let them eat cake.

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