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Tax cuts = no rise in the minimum wage?

Written By: - Date published: 3:04 pm, March 13th, 2008 - 26 comments
Categories: tax, workers' rights - Tags: ,

dollar-sign.jpgFrom the ABC site:

“A peak business group says the Federal Government’s promised tax cuts should be taken into account when deciding on an increase to the minimum wage.

The Chamber of Commerce and Industry is proposing a rise of $10 to $11 – in line with last year’s increase.

The ACTU is lobbying for a $26 increase and the Federal Government is due to make a submission to the Fair Pay Commission on Friday.”

I suspect we will hear similar calls from business groups in NZ once the proposed tax cut programmes are fleshed out. And I would predict that a National government would feel very comfortable with such a trade off.

The fact that increases to the minimum wage will not be a priority under National has already been raised in a previous post in December last year:

National Party labour and industrial relations spokeswoman Kate Wilkinson said National did not oppose the minimum wage but preferred tax cuts.

“Our policy will be on a broader scale and looking at the bigger picture rather than just relying on this artificial solution of having an arbitrary level of what some people think is a fair wage and some people think is not.”

26 comments on “Tax cuts = no rise in the minimum wage? ”

  1. Leftie 1

    Yes, I agree. If National tips the employment law scales in favour of business, then tax cuts would be worth sweet FA. Us low income workers could even be worse off than now.

  2. higherstandard 2

    Leftie

    Just interested, what would you suggest a government does as the best way to improve your situation as a low income worker.

  3. Leftie 3

    higherstandard

    Consistently increase the minimum wage (and I mean a reasonable increase, not peanuts).

    Actively work to keep unemployment down.

    Make education cheaper to encourage people to upskill.

    Retain fair employment laws.

  4. higherstandard 4

    Thanks Leftie

    Those all sound reasonable.

    And what would you say your responsibilities are to improve your own situation as alow income worker ?

  5. Macro 5

    Thanks Leftie

    Those all sound reasonable.

    And what would you say your responsibilities are to improve your own situation as alow income worker ?”

    What a supercilious comment!

  6. Leftie 6

    higherstandard

    One responsibility would be for me to vote for a worker friendly political party.

    Continuing to belong to my union’s collective contract, so that I have insurance on my pay and conditions.

    Perhaps join Kiwisaver on top of the superannuation I already have.

    Are you going to tell me how life will be so much better for people like myself under National?

  7. higherstandard 7

    Leftie – no just interested in your thinking.

    Macro what’s supercilious about querying personal responsibility leftie obviously didn’t take offence.

  8. burt 8

    Here is the effect (in 2004 figures – imagine it now!) of having progressive taxation.

    Graphing “Ideological Burps’

    And to think you guys can’t get to grips with this concept….

    Leftie

    If we keep increasing the minimum wage while Dr. Cullen’s holding the purse before we know it min wage workers will be paying rich prick tax rates. It’s insane to defend taxation thresholds set in 1999 – only a complete imbecile can’t see how radically different the cost of ‘things’ is now compared to then.

  9. burt 9

    From that link to Gareth Morgan;

    Hot on the heels of the Reserve Bank’s acknowledgement that it has lost control of inflationary pressures from this overheated economy, the Treasury unleashed a salvo of condemnation of the Clark-Cullen administration’s high tax regime. That regime, since 1999, has steadily eroded under their tutelage to the point now that Treasury argues it is holding back growth.

    The response to that charge from Dr Cullen? “Tax has nothing to do with growth’. Oh dear.

    Oh dear indeed!

    CAPTCHA revenues Con

  10. r0b 10

    Here is the effect (in 2004 figures – imagine it now!) of having progressive taxation. […] And to think you guys can’t get to grips with this concept

    Good old Burt, he knows so much better than the experts.

    http://en.wikipedia.org/wiki/Progressive_tax

    “In most western European countries and the United States, advocates of progressive taxation include the vast majority of economists and social scientists.” It’s only Wikipedia, but note the references.

    If we keep increasing the minimum wage while Dr. Cullen’s holding the purse before we know it min wage workers will be paying rich prick tax rates.

    Do the math Burt. Minimum wage at $28 per hour? That would be nice! We can only hope that the current Labour led government lasts so long.

    Hot on the heels of the Reserve Bank’s acknowledgement that it has lost control of inflationary pressures from this overheated economy,

    That article was 2004 Burt. Try to keep up.

    “Tax has nothing to do with growth’. Oh dear.

    See this graph of GDP Burt: http://www.rbnz.govt.nz/keygraphs/Fig2.html
    Notice the huge plummeting dive in the 90’s under National (“low tax”?). Notice the generally better performance since 1999 under Labour (who raised taxes).

    Yet another case of your partisan ideology done in by ugly facts. Oh dear, Burt. Good night.

  11. sdm 11

    Leftie – perhaps your responsibility is to upskil and become more producive, so as to be more valuable to your employer.

  12. Draco TB 12

    Leftie – perhaps your responsibility is to upskil and become more producive, so as to be more valuable to your employer.

    I do happen to think people should be upskilling but not to become more valuable to their employer but to become more valuable to themselves.

    Of course – if we actually had a free market, we wouldn’t have employers anyway.

  13. Hey righties – if you want to talk “personal responsibility” then you better send me a cheque asap ‘cos it’s my taxes that paid for your education. Oh and while you’re at it you better add in the dollars that paid for your doctor’s subsidies, the public infrastructure you use and maybe some interest as well. Ha! personal responsibility – you chumps wouldn’t know it if it bit you on the arse…

  14. Tim 14

    There are quite a few condescending comments here. “Productivity” for low income workers is more about getting them to do more work for less pay. For example, for cleaners it basically means less staff, ridiculous work rates and hours that are all over the place. The euphemism used is “flexibility”.

    Really the issue isn’t about productivity, it’s about employers giving workers a larger slice of what they produce already and recognising the true value of their work, rather than the value their economic power allows them to dictate.

    That philosophy aside, if employers aren’t willing to invest in training and equipment to increase productivity then it’s impossible for a worker to become more productive.

  15. Higherstandard 15

    RS

    Doesn’t everyone taxes pay for state education. health and the public infrastructure and isn’t the proportion of total tax paid skewed to those in the more wealthy demographic ?

    Your intimation that only those to the left have any inkling of personal responsibility is bizarre !

  16. HS – what I’m trying to point out to you with a bit of (obviously too subtle) satire bro, is that your cult of “individual responsibility” and the “rugged individualism” that goes with it is a myth. We live in a society chump, and our fates are inextricably tied to the nature of that society. But don’t let that stop you trying to imply it’s the fault of the low-paid worker that they’re low paid. Whatever lets you sleep at night, bro…

    Oh and if you’re gonna try the mobility argument next, don’t bother you’ll be on a hiding to nothing…

  17. higherstandard 17

    Dear RS Bro

    Instead of personal attacks why not reply to the points I raised.

    I’m not implying it’s the fault of the low paid worker that they’re low paid although for the younger generation it would be expected that they start on low wages which then increase as they become more experienced and valued as an employee.

    For those on very long term low wages other issues must be addressed both societal and personal.

  18. And what would you say your responsibilities are to improve your own situation as alow income worker ?

    I may have read more into this than you meant to infer but it does seem like your subtext shows a leaning toward an “it’s the workers’ fault” argument.

  19. Oh no – I used “infer” rather than “imply”. How embarrassing…

  20. Hillary 20

    Higherstandard, how can low paid workers who work every hour that God gives just to put food on the table and pay the rent have any energy leftover to ‘improve their situation’?

    And not everyone is capable of getting a degree or whatever it takes to ‘improve their situation’. Which is just as well as someone has to do the cleaning and labouring and work in the supermarkets etc. The question is how little we as a society will allow them to be paid? Is it at the rate that sometimes not especially competent, and/or greedy, business people feel they can afford to pay? Or do we set a bottom limit we allow them to pay their workers, so that if the business can’t afford to pay at that rate, then it is simply not a viable business?

  21. Macro 21

    Higher standard
    Referring back to your earlier comments.
    Its not the question – Its the way that you asked it! You adopt an attitude of “greater and smarter than thou” – that is supercilious.
    It’s an “I’m better than you question” and that I found offensive, whether Leftie found it so or not. The last comment from Hillary takes up much the same point, so I’m not the only one here who finds your approach to social justice slightly self absorbing.

  22. higherstandard 22

    For a start

    Hillary

    Leftie doesn’t appear to be incapable of imrpoving themselves take a look at their post

    Consistently increase the minimum wage (and I mean a reasonable increase, not peanuts).

    Actively work to keep unemployment down.

    Make education cheaper to encourage people to upskill.

    Retain fair employment laws.

    They appear to be well educated and very literate and probably well capable of improving their situation.

    Macro you might find my approach to social justice self absorbing fair enough I find many of the posts here which suggest the governmanetal intervention is the solution to all societies ills.

    I’ve also yet to have any response regarding the screeching from RS from the points I raised several paragraphs above.

  23. Hillary 23

    GGrrrr. Someone will always have to clean the dunnies!!!

  24. CM Burns 24

    HS

    Stop playing games with the socialists. Why don’t you just tell them that it’s obvious that leftie’s not on the minimum wage and his post was bogus shite and that you’re just having sport with them.

    Good catch on calling sod on his vitriol which is reproduced below for keen readers

    From Robinsod earlier “Hey righties – if you want to talk “personal responsibility’ then you better send me a cheque asap ‘cos it’s my taxes that paid for your education. Oh and while you’re at it you better add in the dollars that paid for your doctor’s subsidies, the public infrastructure you use and maybe some interest as well.”

    [lprent: see my addition to your repeated comment – here. One of the ways I define trolling is having the stupidity to paste the same comment in two seperate posts and not expect that a sysop will notice. You will either troll intelligently or depart (willing or not)]

    For Rob’s information tax take comes primarily from individual income tax (46%) the lion’s share of that same income tax (53%) that pays for the services Robinsod aludes to comes from those in the highest tax bracket (53%), GST 19% and corporate taxes 17% make up the largest parts of the remainder of govt tax income aren’t these all the same rich pricks according to Sod who need to repay all the money to him that as taxes have paid for their education and their health services, man you guys have a screwed up view of the world seems like it’s the other way around to me.

  25. CM Burns 25

    Hillary

    If you have issues I suggest when you take a dump you try to make sure it doesn’t hit the sides.

    Interestingly there is apparently a terminology for your affliction – CORPOROPHOBIA

  26. Hillary 26

    CMB, you are weird.

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