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Redistributing the wealth

Written By: - Date published: 3:27 pm, March 20th, 2009 - 104 comments
Categories: national/act government, same old national, tax - Tags: ,

In a speech to the International Fiscal Association Conference today, Revenue Minister Peter Dunne said the Government’s goal over the next 18 months is to start moving towards a top personal tax rate of 30%.

This would be a whopping 9% cut from the current top tax rate, almost exclusively going to the rich, and causing a massive fiscal hole that could only be paid for through major cuts to public services or through tax increases on low and middle income families.

There’s really no other way to interpret this than a plan by National and its allies to redistribute billions of dollars of taxpayers’ money to the country’s richest people and force the rest of us to pay for it.

So much for John Key and his smiling centrism.

104 comments on “Redistributing the wealth”

  1. I’ve never quite worked out who does the accounting for United Future. They propose a very low tax take (30% top, and income splitting) and yet generally also propose the extension, rather than the retraction, of many government services.

    You can’t have it both ways Mr Dunne.

  2. cocamc 2

    I read that the maximum top tax rate is desired to be at 30%. That doesn’t mean they won’t look at rates down the scale to give tax relief across the board.

  3. Tigger 3

    Ah Mr Dunne. What horrid back-room deal did you do to secure the future of your Families Commission? We all know the NACTs want it gone so why does it still stand when every department around it is getting chopped back?

  4. Jasper 4

    Perhaps Dunne Future wants to privatise the extension of government services?

  5. the sprout 5

    and so the real face of National emerges

    • Ag 5.1

      And that’s a good thing. They had already been out of government for nine years due to public distaste for Rogernomics, and only got back in because they managed to convince the oafs in the middle that they weren’t going that way any more.

      And they’re trying to do it in the midst of a severe recession. If they carry on like this, they’re going to get slaughtered in the next election.

      Ordinary people don’t like Rogernomics, but National donors do. That means that the National Party is essentially a contradiction that can only survive by deceit. Hollow Men II.

  6. Peter Johns - bigoted troll in jerkoff mode 6

    Tane – you really have a problem of people keeping their own money. Your thieving Labour mates stole too much in tax from me over the years and spunked it up the wall.

    Socialism = robbery.

    I earn $80K PA, am I rich then? You got to be joking. Sure I am better off than a lot of people but I still have to watch what I spend.

    In case you did not notice people are sick of thieving governments and control freak legislation that Lab and the Greens hoisted on us in the past 2 years.

    BTW – rich pricks are tax payers too, they kept you going in your social paradise for 9 years of hard Labour.

    • the sprout 6.1

      PJ, I think you’ll find the equation is:

      Privatization = robbery

    • Tane 6.2

      Socialism = robbery

      Property = theft.

      See? We can both play this game.

      [captcha: le revenue]

    • aj 6.3

      Speak to investors in the USA, UK Aussie and NZ – and others – they will tell your that Capitalism = Robbery.

      And the last year has shown the blinding truth of that statement

    • Kaplan 6.4

      PJ: “I earn $80K PA, am I rich then? You got to be joking. Sure I am better off than a lot of people but I still have to watch what I spend.”

      So whats the problem then? You want to NOT have to watch what you spend? Just how much of a greedy fuckwit are you?

    • Draco T Bastard 6.5

      It’s not theft and can’t possibly be theft. It’s payment for services rendered. By advocating not paying you’re advocating theft.

    • Ag 6.6

      No. My guess is he has a problem with people who are so stupid that they don’t even know why we pay tax.

    • Your only earning 4.5 times as much as a normal person earns, you must really be suffering.

  7. TightyRighty 7

    yawn. so many whingers on this site. the top tax rate is hardly rich. what about if they introduced a fourth tax bracket for say 150k plus and the third highest was from 70k-150k and paid 33% tax. would you still be whinging?

    • Tane 7.1

      By definition it’s the top few percent of income earners. So yes, people in the top tax bracket are rich. If they think they’re not, they have no idea what kind of incomes most people in this country live on.

      I’m all in favour of a more progressive tax system, so a higher rate for 150k plus would be welcome. The increased income can go to better public services and tax reductions for people on low to middle incomes.

      • TightyRighty 7.1.1

        great half the question answered, i too see the need for a new top end bracket, as the current brackets don’t accurately reflect the nature of income in this land. so, i’ll ask again, would you cut the whinging if there was another top-end bracket introduced and the 70k-150k brakcet paid 33%?

        oh, and “by definition” is a bit of a cop out Tane, and i think you know that. when labour came to power, your right, only the top few percent of earners were in the top tax bracket, but income levels rising alongside inflation mean that that “few percent” is now more like 15-20% of earners. and i bet only 4-5% of that brakcet acutally feel rich.

        • Tane 7.1.1.1

          Mate, I’m not going to cost out a full bloody tax programme in a blog comments section. I’ve told you where my preferences are, I’m sure the detail can be worked out later if someone decides to make me Minister of Finance.

          I don’t see how “by definition” is a cop-out. If the top tax rate only affects the top few percent of earners then by definition they’re rich. If not them, then who? The bottom few percent?

          • TightyRighty 7.1.1.1.1

            because by your definition, it’s the top “few” percent who shoud be taxed at the top rate. when it’s actually a rather large proportion of the population, (ie more than the top few percent) the whole lot deserve a tax cut as you can’t effectively discriminate can you?

            and sticking to the definition as your argument when the definition is different to the fact, is a cop out. how about more productive solutions or comments than “tax-cuts for top tax bracket = bad”? i’ve come up with a better solution, and im barely even part time at this. introduce a new top-top brakcet.

    • What’s wrong with targeting tax cuts to the 78% of kiwis who earn under $50,000 a year? Why does debate about tax cuts always focus on the top tax bracket? Could it have something to do with the fact that the people calling for tax cuts are normally the ones who earn the most, while the people on lower incomes are just generally getting on with earning a living?
      http://www.treasury.govt.nz/budget/2008/taxpayers/01.htm#whopays

  8. It would be interesting to see what effect that had on the tax take Tighty. If there was no real net change then I think that would be a great idea. However, for that to be the case the top rate might need to be around 45%.

  9. ieuan 9

    There is definitely an issue with the people who run this site about reducing taxes, especially for those who earn the most.

    Generally their argument goes ‘lower taxes for the rich = less money for services for the poor’.

    But what I would like to know is what level of taxation would the people who run ‘The Standard’ like to see?

    And by the way: ‘Capitalism = mostly crap, but the only thing that comes close to working’

    • Tane 9.1

      You’d have to ask them individually. Generally people here prefer progressive taxation, the degree is where we differ.

    • gingercrush 9.2

      The Green party has long advocated for the first $5,000 of earnings to be tax free. Though they’d put in taxes in regards to pollutants etc.

  10. gingercrush 10

    To start moving towards 30%. In other words. Once the economy recovers we’ll start putting measures in place for the top tax rate to slowly go down. It won’t please the left. But neither am I sure that it will please many on the right. Since many want a sudden tax cut down to 30.

    • Tane 10.1

      It won’t please the left. But neither am I sure that it will please many on the right.

      You could say that about any policy short of full-blown communism or extreme libertarianism. The fact is this is a pretty radical right tax policy that’s been announced, and it puts the lie to John Key’s claims of centrism.

  11. Conor Roberts 11

    I never understand why the media persist on calling Peter Dunne centrist. Almost all of his policy prescriptions are to the right of National. Lazy stuff.

  12. jarbury 12

    He’s centre/left when it comes to spending money, but far right when it comes to taking in money. As I said in the first reply to this thread… something’s got to give, he can’t have it both ways.

    We’d all love to have lower taxes and higher government spending, but unfortunately unlike Peter Dunne the rest of us live in the real world and realise it has to give one way or the other.

  13. MikeE 13

    Its not redistributing a cent.

    Its allowing people to keep money they have earned.

    • Tane 13.1

      I get sick of explaining this to libertarians.

      The capitalist system – from private property to markets to the legal fiction of the corporation, right through to the power to command other individuals in exchange for payment – is a social creation.

      The “I earned it and I get to keep it” argument shows a fundamental misunderstanding of how wealth is created.

  14. gingercrush 14

    Ugh reading the speech. I see the company tax won’t be lowering which for me is disappointing. What is even more disappointing is that they admit that our company tax rate is above the median for the OCED. I would much rather see a big cut for company tax than I would personal tax cuts. Not that I’m not in favour of personal tax cuts. I just think more importance should be placed on the company tax rate. The government seems to think having trust, company and highest earners on 30% is the ideal position. I think its disappointing. Though for very small businesses I’m sure such a policy would help.

    A cut of the top tax rate down to 30% doesn’t necessarily mean less revenue. It is however, dependent on good economic growth and a rise in earnings for those on the top rate and those just below to come into the top rate. And of course it has to be implemented slowly so there isn’t a sudden huge fall in revenue. Its doable. But its going to depend on a few good years of solid economic growth.

    As for income splitting it won’t pass a second reading. And its funny that they talk about 30% top rate for personal tax cuts yet the speech highlights the fact revenue is already down and debt is going to increase. They will certainly have to do more to convince New Zealanders.

    • National government’s never cut the company tax rate. History has clearly shown that it’s usually Labour govt’s that cut company tax.

      • gingercrush 14.1.1

        Well had National been elected in 2005 a 30% company tax would have implemented. Indeed Labour was one of the last parties to consider 30%. And of course Labour only did tax cuts in the end and then had the brass to come out and say that its because Treasury finally said it was time to implement tax cuts. When Treasury has always stated their intentions and tax cuts should be implemented.

        But regardless, you’re quite correct that National has been slow to tackle company tax rates and that historically they haven’t. And personally I would like to see furthers cuts to Company Tax.

        —-

        BTW Labour is stupid if they don’t have you on their front bench by 2011.

  15. jarbury 15

    Yes when one considers the state of the government’s books in the next few years they’re going to need all the tax revenue they can find. I’m quite a fan of income-splitting myself, as it’s useful for helping families and is a step towards avoiding forcing mothers to return to work earlier than they want to (and therefore having to put their kids in childcare).

    It’s debatable whether income-splitting or greater parental leave is more effective I suppose.

  16. Tane 16

    TightyRighty: I’m fundamentally against any moves to make the tax system less progressive for reasons of the inequality it creates. Without getting into a huge debate about redesigning the tax system I think leaving it as it is is preferable to the plans of National and its allies.

    If we’re talking about ideals then there’s a whole different debate that I frankly can’t be bothered engaging in right now.

    Your other comment:

    because by your definition, it’s the top “few’ percent who shoud be taxed at the top rate. when it’s actually a rather large proportion of the population, (ie more than the top few percent) the whole lot deserve a tax cut as you can’t effectively discriminate can you?

    I can’t make sense of. I’m not against increasing the number of steps in the tax system, if that’s what you’re on about.

  17. George Darroch 17

    NZ already has lower personal tax rates than any countries in the OECD except Mexico and South Korea. In any other country, a top tax rate of 30% would be to the far right of the spectrum.

    With NZ’s graduated system, and the 12.5% GST flat tax, that will be very close to Douglas’ beloved flat tax for almost everyone.

  18. gingercrush 18

    Is anyone having problems with caching. The main page seems stuck at this thread having 24 messages. Yet as of now it’s 29 messages.

    • Tane 18.1

      Yeah, I get that like every day. I’m not sure what to do about it, other than clear the cache and hope for the best.

  19. Quoth the Raven 19

    Oh, the shark, babe, has such teeth, dear
    And it shows them pearly white
    Just a jackknife has old JohnKey, babe
    And he keeps it ah out of sight.

    Ya know when that shark bites, with his teeth, babe
    Scarlet billows start to spread
    Fancy gloves, though, wears old JohnKey, babe
    So there’s nevah, nevah a trace of red.

  20. Steve 20

    I’d rather see the thresholds pushed so that the middle rate applied between 50-100k and moves made to have a tax free income part that this crap about having the top personal rate = company rate, it doesn’t in places like UK, AU, USA so why do we need to? Only real reason I can see if we were going to have a flat tax. That way all income earners benefit and I think the woe is us from those that have worked hard or got lucky enough to have an income that attracts the top rate wouldn’t resonate as at 100k there is no arguing that in NZ you are income wealthy.

  21. DS 21

    [In reply to Tane’s reply to Mike E]

    Tane, to the extent income is contingent upon individual action, it is earned and legitimate to keep. You can argue about determinism if you like, or you can think about some of the societies that have estimated this extent to be negligible.

    Collective decision making is also individual action with a whole lot of perverse incentives and information problems. Your idea that a collectively decided income distribution is somehow more valid than the result of private transactions, and the corollary that reductions in redistribution levels are therefore redistributions in themselves, is no better than MikE’s contention of the opposite.

    You can criticise ‘capitalism’ all you like, but the problems with collective decision making are just as great if not greater, and they tend to intervene in the economy so much that it is hard to really separate the two anyway. For instance, it the current AIG bonus scandal a problem of capitalism or government intervention???

    PS You might also want to start thinking about the difference between ‘rich’ and high income because the distinction gets wider and wider as you increase taxes on higher incomes, punitive tax rates rarely achieve their stated intent of ‘soaking the rich.’

    • Tane 21.1

      I’m not advocating that no recognition be made for individual effort and enterprise. I’m simply saying these things rest on a basis of socially constructed property rights. As a society we see the benefit for everyone in rewarding individual effort and that’s why we don’t have a 100% tax rate or anything absurd like that.

      My critique was of the fundamental flaws in Mike’s libertarianism, it wasn’t a critique of the principle of rewarding individual effort.

    • DS 21.2

      So if you accept that income is contingent on individual action to some extent, then not all redistribution is a social construct. A more accurate title for your post would have been something like ‘Reducing government income redistribution’ or ‘Getting closer to private market income distributions.’

      MikeE was at least half right.

      • Tane 21.2.1

        Where do you think the wealth of the rich comes from but from the existence of the state? Do you think Donald Trumpwould have his level of wealth in a libertarian state of nature? If so, how long do you think he could hold onto it?

        Every policy is a redistribution of wealth in some regard, it’s just the Right choose to start their political narrative at the point of a ready-existing capitalist society.

        • DS 21.2.1.1

          You ask an interesting question. From what I can see of the failure of the Washington Consensus in a lot of states, it’s more a matter of culture or prevailing beliefs that allow private property to be respected than it is a matter of governments forcing civility. Governments that try to counteract the prevailing beliefs of the population generally don’t last very long.

          So I guess in a Libertarian state of nature with New Zealand’s cultural values Trump would have a pretty good chance of amassing and retaining his wealth. In Somalia (or even France for that matter!) I wouldn’t like Trump’s chances.

          The left always like to see culture as created by government, probably because it creates an important space for themselves in society). I think that cultures evolve and create governments. (Hayek’s Fatal Conceit is an excellent book on this topic)

          • Tane 21.2.1.1.1

            There’s no way the massive inequalities of wealth in a capitalist system would survive without the coercive power of the state. That’s why very few businessmen are anarchists.

  22. aj 22

    Thank you for pointing this out.
    Our ‘tax wedge’ is amongst the lowest in the oecd.

  23. How much do you have to earn to be in the top rate of 30%?

    • Tane 23.1

      According to their tax policy the top tax bracket from April 1, 2011, will be from $70,000 upwards. You can probably assume they’ll keep the brackets broadly the same, adjusting for inflation, and just move the headline rate down.

      Of course, that would wipe out the 50-70k band, which they’re planning to have at 33% by 2011. I assume if that band still existed they’d have to drop the rate even further.

  24. So if you earn under 70 thousand you will pay 19.5% and the rest will pay 30%

    I don’t think 70 thousand a year can be called rich, well off, comfortable, earning a great wage, but not rich.

  25. Strictly speaking it wouldn’t be redistributing wealth to the rich, it would be ceasing redistributing wealth from them.

    Also, I believe this was part of the deal with United Future immediately after the election, but perhaps few people pay attention to these things. The ‘medium term goal’ was (if I recall correctly) bands of 10%, 20% and 30%.

    • Quoth the Raven 25.1

      The state redistributes wealth to the rich. The state reflects the interests of the privileged. As Oppenhiemer said the state: “”I mean by it that summation of privileges and dominating positions which are brought into being by extra-economic power”
      I resent tax as much as the next person. But taxes should be cut from the bottom first and foremost not from the top. Cutting taxes at the top just cements the priviliged position brought into being by the state of the plutocrats.

    • Tane 25.2

      Tom, see my comment above.

      Redistributing the wealth

  26. djp 26

    Seriously Tane, I think you are crazy 🙂

    Firstly, like MikeE said, its is not more redistributing, it is less redistributing


    The capitalist system – from private property to markets to the legal fiction of the corporation, right through to the power to command other individuals in exchange for payment – is a social creation.

    What about the Maori tribes ownership of parts of Aoteroa? Was (is) that a legal fiction?

    There is no “power to command other individuals in exchange for payment”, the only entities with the power to command are state ones. There is the simply the opportunity to (attempt to) trade.

    • RedLogix 26.1

      There is no “power to command other individuals in exchange for payment’

      Try telling that to your boss come Monday morning. Keen to know how it goes.

      • DS 26.1.1

        Gladly, I will tell him. He certainly doesn’t have the ‘power’ to do so in any meaningful sense. He has the opportunity to offer and I can accept, that is what you missed by cutting off the last sentence of djp’s comment. To see the contrast, think about slavery where a person is deemed property and has no legal right to leave a contract no matter how intolerable its commands. Quite different to what we have in a free market, huh?

  27. RedLogix 27

    In the meantime wealth is busy being being re-distributed in lots of other ways. We’ve been lulled into thinking that the global financial melt-down isn’t going to touch us.

    The latest Reserve Bank Bulletin reveals that Australian banks have more than $13 trillion in off-balance-sheet derivative exposures, compared with $5.4 trillion six years ago. If just 1 per cent of these blew up because third parties at the other end got into trouble, the whole shareholder wealth would be wiped out and the banks could be broke.

    As total bank assets are $2.3 trillion, why do Australia’s banks have exposure to $13 trillion of derivatives positions? All banks hedge to reduce risk, but this is a great deal of hedging.

    To put it in perspective, Australia’s GDP is about $1.3 trillion, our pool of investment fund assets is $1.2 trillion and the freely floated market capitalisation of the stock market is $1 trillion.

    Right now, we are being told Australia’s banks are safe.

    The Australian

    New Zealand and Australia are in the same dire straits as rest of the Western world:

    1. Very high total debt levels.

    2. Dependency on overseas wholesale funding (30-40%) to maintain a huge portion of our current GDP

    3. A residential property market bubble that still has a long way to unwind.

    4. Potentially insolvent banks highly exposed to a very unstable derivatives market.

    5. Falling government income, made even worse by a Cabinet ideologically committed to damaging it even further.

    Yes, the New Zealand government has a very low debt right now, but that alone is a very tenuous shelter from the shitstorm bearing down on us.

    • Snail 27.1

      RL,

      it might help some to recognise the trillion (ie $13Tn) figure/s are nominal. We could take this to be the leveraged sum, rather than realistic market value/s.

      The Lehmann let-go by Paulson finally showed up nominals, eg from memory the counterparty settlements came in at around 6 percent. Usually for cash of course, a condition worth noting cf to operational leveraging. That is to say the deriv seller optimises deals around ‘false’ default payouts.. the buyer’s greed as much as anything fixating the sum total.

      I’d guess from the article you cite that bank or media assertions to safety incorporate such understanding/s

      Thanks for the Australian article which I’d missed back in October 08.

  28. mike 28

    “redistribute billions of dollars of taxpayers’ money to the country’s richest people and force the rest of us to pay for it.”

    Bollocks Tane – tax in itself is redistribution of money. It’s about time the “rest of you” pulled your weight and got off your collective arses – why should a few be made to pay for so many, ie WWF should go, it is unsustainable for a decreasing few to subsidise parents who in reality pay no tax at all.

    • Draco T Bastard 28.1

      If you want WWF to go then you will need to raise wages because nothing can be supplied at less than cost price and the cost of supplying labour is far above the average income. As people in this thread have said – $100k isn’t really a hell of a lot.

      • rjs131 28.1.1

        WWF……..WHAT HAVE YOU GUYS GOT AGAINST WRESTLERS ?

        • lprent 28.1.1.1

          They’re on TV. But I guess that if it is a choice between wrestling (or any other sport), reality shows, top humiliation shows and how to fix a house (been there and done it), I think I’ll just give up on TV.

          Damn already did that – 7 years ago..

  29. RedLogix 29

    It’s about time the “rest of you’ pulled your weight and got off your collective arses

    No Mike, if you don’t want to play on the team, please feel free to go somewhere else where you don’t have to pay tax. There are quite a few countries in the world that have low to no tax regimes; surely one of them might suit.

  30. Joshua 30

    WWF – the Wildlife Fund or the Wrestling Federation?

  31. Of course everyone paying the same rate would be much fairer than penalising those who succeed but lets ignore that and rant about the evil “rich.”

    Though living in Auckland with a family on less thatn $60k leaves you barely able to buy food but of course since that is more money than a family on $30k this fact is irrelevant. More = rich even if it goes nowhere.

    • r0b 31.1

      Of course everyone paying the same rate would be much fairer than penalising those who succeed but lets ignore that and rant about the evil “rich.’

      Your blog describes you as an evangelical christian Madeleine, so I’m a little surprised to find that you resent the idea of the well off helping those in need. Also, no one here is “ranting” about the “evil” rich, and such wild accusations don’t reflect well on your objectivity.

    • ak 31.2

      Oh joy, the lovely Madeleine.graces our shores again. More doesn’t mean rich, darling, and “success” remains exclusively in the eyes of the beholder.

      $60k eh? I feel for ya. This morning I gave a food parcel to a glorious family on $19k, at lunchtime glimpsed an item that had a US celebrity divorcee decrying $200mill as “not enough to live on”, and remembered that 28,000 babies die every day for want of a few cents.

      Redistribution my arse. A few cents here…..pffffft

      Actual redistribution of human endeavour has always been, and remains, mono-directional: from the hands-on, actual producers of goods and services to the tory, do-little takers.

      Key and his fellow greedy paper-shufflers have produced nothing but the current disaster: watch now as millions more will now die.

      Or get off your arses and actually change the world.

    • Really what we need is an inverse tax system, under 50K and your paying 30%, over and your paying 15%, think of it as an incentive to earn more!

  32. jbc 32

    There are quite a few countries in the world that have low to no tax regimes; surely one of them might suit.

    Careful, RedLogix. That’s true but is it the best thing for NZ to export its capital to low-tax regimes? Those small countries that deliberately attract wealth with a different set of priorities (tax, immigration, law, welfare) have an advantage in that they leave countries like NZ to take care of the rest.

    If it’s true that a small percentage of taxpayers pay the bulk of the tax then it would make sense to grow (eg: double) that small share and reduce the tax, wouldn’t it?

    Problem is that would be in direct contradiction to the goal of reducing inequality.

    If every country had equal tax laws then I think we would all be astonished at how much money would flow back to NZ.

    I guess you need to shift your definition of equality from local to global.

  33. Bevanj 33

    Doesn’t few mean 3 or 4?

    Does only 3 or 4 percent of our workforce earn above $70k?

    • Draco T Bastard 33.1

      Last time I looked, which was a few years ago, 3% had an income over $100k.

  34. out of bed 34

    We should all listen to the economist Ravi Batra?

    Prophet of Boom (and Bust)
    http://www.fwweekly.com/content.asp?article=7369
    Cutting taxes is not going to help!!!!

    Batra?s approach to forecasting is based on historical cycles of inflation, money growth, and depression as well as the law of social cycles

    He seems to have it sussed

    • Draco T Bastard 34.1

      From article:

      more to the point, an economic theory that flies in the face of today’s accepted wisdom — in the face, that is, of the theories and practices that got us in the horrendous spot we’re in today.

      hehe – I lol’d 😀

      That’s a good article – I’m going to have to get some of his books.

  35. Bevanj 35

    So I’d suggest there’s a bit of a liberty being taken by Tane to suggest that it a few percent earning over $70k.

    Does Tane’s “definition” of rich need to be shifted to $100k + to capture just the top few?

    He’d probably alienate less people with his comments.

    • Tane 35.1

      So now you’re having a cry over the definition of ‘few’? It’s a shorthand Bev, the point is that even if you use the figure of 7%, that’s still wealthy by any standard.

      If you want an even higher tax bracket for the top 3 or 4% then be my guest.

  36. Bevanj 36

    Having had a quick look the ’06 census points to over 7% in the $70k+ and over 3% (a few) in the $100k+ with a further 10% not stated. I’d suggest the numbers are even higher by 2009.

  37. justthefacts 37

    This is great news, the sooner the tax rate is lowered the better, I am sick of governments stealing the money I earn and wasting it on low life and people who think they have a right to sponge from society.

    The “middle” will vote for this in their droves, when times are tough the middle class resent paying money to those who can work but choose not to do so, they also resent silly failed social engineering experiments and liberals wasting their money on idealogical theories.

  38. gomango 38

    Just in case anyone wants to see the facts about who earns what, and who pays what amount of tax in NZ (as personal income earners), it is all here.

    Key facts for taxpayers. http://www.treasury.govt.nz/budget/2008/taxpayers/01.htm#whopays

    11% of taxpayers pay 46% of tax.

    • r0b 38.1

      11% of taxpayers pay 46% of tax.

      What proportion of the country’s wealth do that 11% control?

      Just by way of comparison, in America (2001 data), the top 1% of households owned 33.4% of US privately held wealth, the bottom 80% only 16%.

    • r0b 38.2

      Ahh here we go, some NZ data:

      Wealth holdings in New Zealand are highly concentrated, with the wealthiest 10% of the population holding over 50% of total wealth and the bottom half of the population holding less than 3%.

      So gomango, sounds to me like your top 11% aren’t paying enough tax.

  39. vto 39

    i like rave’s idea of socialising the means of production. govt then wouldnt need to tax at all because everything could be paid for from its profitable industry. dont know why this idea doesnt catch on..

  40. justthefacts 40

    Moan all you like guys, lower taxes are on their way.

    By all means make it a major issue at the next election, the “middle” will not beleive a word you say about only raising tax on “the rich”.

    Tough times breed tough people, the old days of the state providing everything for the lazy and the idle are over.

    I cannot wait.

    • r0b 40.1

      It’s nice that you get such a kick out of other people’s suffering justhefacts. All those lazy and idle babies and children are finally going to get what’s coming to them eh. And you’ll love every minute of it – just can’t wait.

      Ahh, I don’t believe in “judgement day”, but some times I wish that I did…

    • Snail 40.2

      simple question for you to answer from a no moaner..

      Are the old days of no work, starvation and widespread disease over also..?

  41. justthefacts 41

    Who is suffering by lowering taxes Rob?

    You claim that babies and children will be affected which is utter rubbish, why not just admit that you are envious of those who happen to work hard.

    If SOME children and babies do not have as much as they would like then it might pay to look at their parents who continue to breed when they cannot afford to feed the kids they already have.

    Judgement day is here Rob, the “middle” have had enough of paying for kids that are not their own and paying for the bribes of the left.

  42. Bevanj 42

    Re: r0b: “So gomango, sounds to me like your top 11% aren’t paying enough tax.”

    I’d suggest that on average those with the most wealth have also taken on the most risk and possibly debt and also provide a large chunk of the salaries and wages that fills the tummies, etc.

    I don’t mind paying tax, I pay my share and it’s a lot.

    I do mind when I see it wasted and I mind when I can’t access some of the services it provides to others.

    I have a vague recollection of a pre-election interview with Jim Anderton who posed a fairly valid point along the lines that compared to generations that have gone before what have recent policy makers done to support/encourage the following generations and foster a sense of pride and community spirit.

  43. r0b 43

    what have recent policy makers done to support/encourage the following generations and foster a sense of pride and community spirit.

    Well let’s see. Support and encouragement – the last Labour government got unemployment down to 30 year lows, crime down, numbers on benefits down, raised the minimum wage every year, introduced four weeks leave and 20 hours free early childhood education, fair rents, interest free loans for students, got poverty / childhood poverty rates down, suicide rates down, introduced cheaper doctors vists, modern apprenticeships, tax cuts, Working for Families and employment law which stopped the widening wage gap with Australia.

    Pride and community spirit? The TVNZ charter, NZ on AIr, funding for the arts, support for sporting teams, America’s cup yachting and the Rugby World Cup bid, support for the film industry (e.g. Lord of The Rings).

    Not a bad record. What will National do I wonder…

    Anyway, ttfn.

    • Draco T Bastard 43.1

      Repeal all of it so their rich mates can get a pay rise from decreased tax rates (ie, not increased productivity).

  44. jbc 44

    [blah blah] rich mates [blah] pay rise [blah] decreased tax rates[blah blah blah]

    Bastard: would you rather have 1 rich mate paying you 39% of her income (and who is eyeing one-way airfares), 2 rich mates paying 20%, or no rich mates at all?

    Curious.

  45. Bevanj 45

    r0b if you put your pompoms aside for a minute, there’s income testing that means kids with 2 working parents get punished if going to varsity.

    How is free education for younger kids looking? Has anyone seen it recently?

    A close friend once battled a serious illness, his employer stuck by him so he was able to earn while battling. Driven chap. All this meant he got no tax-payer-funded support for the treatment. He would have received this support had he simply dropped out. His extended family stumped up, all very high tax payers.

    I’ve a mate who is a cop so have some insight into the conditions and staffing levels they work under. I think he’s mad but its obviously a calling. I think most kiwis would be shocked to know the real staffing levels in their region as opposed to the official shift numbers. I was.

    More and more NZers are in these “rich” tax bands and they and their children get less and less assistance from the state.

    Getting some tax back via working for families can’t hurt. How many young families “comfortably” operate on one income compared to 30 or 40 years ago?

    … and picking up my anti-clark-govt line again, knocking off the interest from student loans was a last minute election year bribe as was the more recent promise of tax cuts. Both are a far cry from an underlying philosophy to encourage people to contribute.

    • r0b 45.1

      r0b if you put your pompoms aside for a minute

      You asked what the last government had done, I answered, and now you’re doing the blogging equivalent of sticking your hands in your ears “la la la I can’t hear you!”.

      No, Labour didn’t get everything perfect, not by a long shot, they were far too timid for that. So yes, you can still find anomalies and exceptions to pick on.

      But in the terms that you mentioned – “Support and encouragement” – “Pride and community spirit”, the Labour led governments of the last 9 years did very well indeed, and much much better (I predict) than National is going to manage in its time.

  46. I always find it amusing that those who argue for a flatter tax system are often the same people who argue that the top tax rate kicks in at too low an income. It’s not rocket science to work out that these are contradictory arguments. If we had just one tax rate, would they argue that it too kicked in at too low an income? It seems to me that their true objection often has little to do with the way the tax system is structured, it has to do with the very notion of paying tax in the first place.

    • RedLogix 46.1

      Also amusing to read them whining about the top tax rate kicking in at around $70k, when that puts them in the top 10% or so of taxpayers (and yes I’m one of them and I gladly pay tax for the privilege of living in this fantastic country).

      Moreover their perspective that $70k is ‘comfortable, but not rich’ is somewhat undermined by the reality that that such and income is 2-3 times the median income of $24k, or the median wage of $28k.

      • Chris Hipkins 46.1.1

        Don’t forget that 78% of all kiwis earn under $50k pear year. So why do we spend so much time debating the top tax bracket, when 78% of kiwis aren’t in it.

  47. Well you know what they say about tory voters, millionaires or fools. So 22% earning over 50k per year, that accounts for half of Nationals voters, Don’t know about the other 23% though, haha.

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