web analytics

Tax Swindle Graph

Written By: - Date published: 8:34 am, September 30th, 2010 - 30 comments
Categories: budget 2010, gst, same old national, tax - Tags:

Danyl over at DimPost has produced an excellent graph of the gains from National’s Tax Swindle.

This is using the Government’s own figures as dutifully re-printed by the media – so no adjustment for the massive inflation caused by the budget that means that roughly half of households will be worse off at the end of the year than at the start of it (according to NZ Institute of Economic Research).

The graph still doesn’t look good.

Danyl’s nicely pointed out where average wages and salaries are on the graph (not median, which are lower, and could have made the graph look worse…).

bradluen in the comments has calculated the relative gain in income, for those who reflexively add that “of course the rich do better in absolute numbers, they earn more, they get more…”

Net gain as a percentage of income:

If you earn $10K/year: 0.23%
If you earn $100K/year: 2.17%

And by the time you take out increased costs of mortgages from raised interest rates, higher rents from landlords passing on their tax avoidance being closed and extra childcare costs…  well, we can all see where the government’s borrowed money for their tax change is going – and it ain’t to average kiwis.

30 comments on “Tax Swindle Graph ”

  1. One thing that irks me is people saying the average wage is $50K a year. Actually, that’s the average full-time wage. The median wage is $35K and the median income is just $28K or so – that means half of taxpayers have incomes below $28K. Tends to make National’s bias towards cutting the top rates even more obviously about rewarding an elite.

    Haven’t crunched the numbers but I reckon that people on the median income or lower would have been better-off with Labour’s completed tax package, rather than National’s tax switch.

  2. prism 2

    Listening to radio this morning. Most taxpayers going to be paying 17.5% – would this must mean that most are on low wages? And I presume that doesn’t include the 15% GST – 15+17.5 = 32.5% which would apply if the propensity is to spend all one’s income on GST loaded goods. But then there is the factor of housing etc that doesn’t incur GST so that has to be deducted from income to find the actual tax percentage and amount paid. Not quite transparent enough for everyone to be able to understand clearly.

    Then Dominic or Brendan economist this a.m. on Radnz made point about it being an inter-generational transfer. Older people drawing on savings for larger expenditures, and no longer wage earners, will pay the higher GST as all do, but won’t be receiving much benefit from lower wage tax. But then the same applies to low wage earners and beneficiaries of any age.

  3. Roger 3

    “And by the time you take out increased costs of mortgages from raised interest rates, higher rents from landlords passing on their tax avoidance being closed and extra childcare costs… well, we can all see where the government’s borrowed money for their tax change is going – and it ain’t to average kiwis.”

    Within weeks we will know exactly what these combined extra costs will be. We will also know years later what the cost of borrowing to pay for these tax cuts will be through interest payments and the unpalatable restrictions placed on future administrations. I suspect that the RWNJ’s will rationalize that everyone is gaining regardless of how much and that the highest income earners were paying too high a percentage of the tax bill. Lets look at these arguments.

    1. Some people will lose. The reduced government services will harm those that need them. The people that use them will be the ones who do not receive enough in their tax cut to cover the extra cost.

    2. Extra taxes on goods and services are will be passed onto the consumer if a business can afford to do so. With goods that are necessities this will usually be the case, with luxuries businesses may have to absorb some of the cost, especially during a recession. So food items that the poor buy, price goes up. New Porsche for the the wealthy person, probably minimal price change.

    3. At the median income, a person over their lifetime will earn $1.26 million assuming they work from 20-65. John Key has the wealth of over 39 median lifetime earnings right now. Graeme Hart has over 1269 median lifetime earnings right now. Paul Reynolds will earn over 5 median lifetime earnings this year. A person earning $100k will reach the median lifetime earnings in 12.6 years. They pay a large proportion of the tax bill because they earn a ridiculously large proportion of the wealth.

    4. The wealthy complain about paying tax for services they don’t use but they rely on government more than the poor. The owners of multiple properties and owners of capital that is used to run businesses from multiple sites need the police to act on crimes committed at multiple locations and districts. They travel around the country more often therefore they personally need hospitals in all areas of the country to be functioning correctly. The education of their children is important but also the education of all children as they will grow up to become the labour that goes into their business production function and develop capital that can grow their business. Their position and ownership of vast amounts of property and capital mean that they are more likely to need the justice system funtioning as they are more likely to require it as the plaintiff.

    Lets see this for what it really is, a smash and grab by the right at the expense of society. RWNJ’s I await your response.

    • Colonial Viper 3.1

      Their position and ownership of vast amounts of property and capital mean that they are more likely to need the justice system funtioning as they are more likely to require it as the plaintiff.

      I guess that explains perfectly the Right’s throw away the keys attitude, three strikes, grow Corrections into the largest department in the land etc.

      • Roger 3.1.1

        Yes and they are not willing to pay for it. The next step is privatisation of the system or public-private partnership where they can own some of the process themselves and put lining their own pockets before justice and human rights. Oh thats right, this is already happening.

  4. ak 4

    Headlines we’d like to see:

    NORTH OF $50 NOW SOUTH OF $5 FOR MOST TAXPAYERS

  5. nilats 5

    Looking forward to my tax cut of $60/wk. If you are on $40, suck it up baby, thanks for the subsidy. Bout time tax got FAIRER for me.

    Tax cuts from NACTIONAL- i\\\’m lovin it.

    I will still pay more tax than most still so I don\\\’t expect too much whinging form you poor socialist luddites.

    • Roger 5.1

      A clear example of the mentality of the RWNJ. Self absorbed, a distorted idea of what fairness is that relates it to their selfish values, and condescending in a manner that is completely unwarranted. Rather than point out any argument as to why the wealthy should have higher tax cuts or how this is better for our country he just tells us to suck it up. But I guess you cannot expect much more than that really.

      • Luxated 5.1.1

        Roger before you replying to nilats you might want to think of this video.

        • Roger 5.1.1.1

          Lol, thanks, I am now somewhat wiser.

          • NickS 5.1.1.1.1

            There’s also Poe’s Law!

            • Maynard J 5.1.1.1.1.1

              There’s also the fact that this person failed three times to complete the simple action of typing in the anti-spam word, as indicated by the ‘/’ character before each apostrophe.

              This is what happens if you fail to enter the word, most people would copy the text, select ‘back’, paste, enter the spam word, and most will also realise that this feature forces the insertion of aforementioned / character before apostrophes.

              I sincerely doubt that someone with the intelligence (or lack thereof) to fail an anti-spam test on three consecutive attempts, and fail to notice the extra characters is capable of earning enough to pay $60 in tax a week, let along qualify for that much of a cut.

              What was your word, nilats? From? That’s an easy one to get wrong, or so it would appear.

              Let’s not even mention the brain power required to craft such gems as “I will still pay more tax than most still”.

              By the way lilnads, we’re all bludgers remember, so you’re still subsidising us if you do pay that much tax. Enjoy. (Apart from me. I earnz waaaay more tahn your getting lulz!!1)

          • Luxated 5.1.1.1.2

            Welcome!

  6. peter 6

    First pay packet in reflecting new PAYE rates.. As I earn over 100K very nice increase.

    • Colonial Viper 6.1

      *Guffaw*

      $100K p.a. was something to write about..maybe in the early ’90’s mate.

    • Maynard J 6.2

      You’re clearly lying, anyone earning a decent amount and who would harp on about it like that is a RWNJ and therefore would rort the system and pay minimal tax on a trust.

      My bet is you can barely get a block of cheese, peter.

    • Armchair Critic 6.3

      Even CEOs on multi-million dollar salaries are wage slaves. If you had any courage to your convictions you would be self employed.

  7. Pascal's bookie 7

    Amazing how all these thoroughly convincing and highly paid illiterate individuals decide that what they really want to do with their tax cut is pop on to the internet and have a wee skite about it on a blog they rarely if ever comment on.

    If they weren’t so transparent one might suspect that they were lefties trying to heighten the contradictions. As it is however, it is to laugh. I suspect compensation is playing a part.

  8. Anne 8

    Funny you should that Pb. I was begining to thunk that ignorince and illitracy was preriqasite for erning a hihe inkum.

    Could they all be the same person?

  9. burt 9

    If we graphed reversing this tax cut after it is implemented it would be the same graph for ‘tax increase’ . It’s the way progressive taxation works.

    You can’t support the progressive taxation model unless you accept this consequence. When you put tax rates up the rich get hit harder, when tax rates come down the rich get the biggest relief.

    You do understand progressive taxation don’t you bunji?

    • felix 9.1

      Weird, I was under the impression that the govt could write any tax law they liked.

      Is that not the case? Are they restricted by some higher power?

      • Maynard J 9.1.1

        Gerry Brownlee.

      • burt 9.1.2

        Even your lot eventually wrote a law that gave bigger tax relief to big earners than it gave it low earners. Even Cullen faced the reality of tinkering with a progressive model.

        And if your lot taught us anything at all, it’s that parliament is unconstrained in NZ.

        • Draco T Bastard 9.1.2.1

          That’s because they were, and probably still are, stupid.

          Hopefully it won’t remain unconstrained for long.

        • felix 9.1.2.2

          Get to the point burt.

          Can parliament pass any tax law it likes or not?

    • Draco T Bastard 9.2

      They could have made the first $10k tax free and everyone would have equally better off (if you think cutting government services is being better off). Of course, NACT didn’t want to do that. What they wanted and did was to give themselves and their rich mates lots of everyone else’s money (we’re borrowing for those tax cuts while also putting taxes up on the lower income earners).

      Tax swindle is a good description of what NACT have done.

      • Jim Nald 9.2.1

        I don’t understand. Nats cry poor, slash public service to the citizenry, borrow and run deficits … and that is responsible and popular Govt?

        • Colonial Viper 9.2.1.1

          NACT is betting at controlling and framing the daily messaging than Labour is. Period.

          The fact that Labour doesn’t seem to have that much to say at the moment doesn’t really help either.

  10. NickS 10

    I look forward to getting less than $5 a fortnight thanks to National and subsidising the rich, who art obviously oh so much better than me, or any other poor person, irrespective of reality.

    Heh, I fail to see how this is actually going to help teh economy, given most of the people who will be pulling in the major tax cuts will likely invest it overseas, while otherwise the tax cuts for most would even cover a days wages at minimum wage. So somehow I expect I wont be seeing a lot of painting work on student job search this summer in Christchurch, and will instead be stuck with minimum wage labouring jobs and last-resort hell-gardens that are better hit with napalm or a chainsaw than “gardened”.

    But hey, what’s more important than giving the rich tax cuts and making those without much pay for it instead? Both now, and in the future as we pay the money borrowed to pay for it back.

Links to post

Recent Comments

Recent Posts

  • Tokelau Language Week reminds us to stay united and strong
    Staying strong in the face of challenges and being true to our heritage and languages are key to preserving our cultural identity and wellbeing, is the focus of the 2020 Tokelau Language Week. Minister for Pacific Peoples, Aupito William Sio, says this year’s theme, ‘Apoapo tau foe, i nā tāfea ...
    BeehiveBy beehive.govt.nz
    23 hours ago
  • NZ announces a third P-3 deployment in support of UN sanctions
    The Government has deployed a Royal New Zealand Air Force P-3K2 Orion (P-3) maritime patrol aircraft to support the implementation of United Nations Security Council (UNSC) resolutions imposing sanctions against North Korea, announced Minister of Foreign Affairs Winston Peters and Minister of Defence Ron Mark. “New Zealand has long supported ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Pacific trade and development agreement a reality
    Pacific regional trade and development agreement PACER Plus will enter into force in 60 days now that the required eight countries have ratified it. Trade and Export Growth Minister David Parker welcomed the announcement that the Cook Islands is the eighth nation to ratify this landmark agreement. “The agreement represents ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Securing a pipeline of teachers
    The Government is changing its approach to teacher recruitment as COVID-19 travel restrictions continue, by boosting a range of initiatives to get more Kiwis into teaching. “When we came into Government, we were faced with a teacher supply crisis,” Education Minister Chris Hipkins said. “Over the past three years, we ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Border exceptions for a small number of international students with visas
    The Government has established a new category that will allow 250 international PhD and postgraduate students to enter New Zealand and continue their studies, in the latest set of border exceptions. “The health, safety and wellbeing of people in New Zealand remains the Government’s top priority. Tight border restrictions remain ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • First COVID-19 vaccine purchase agreement signed
    The Government has signed an agreement to purchase 1.5 million COVID-19 vaccines – enough for 750,000 people – from Pfizer and BioNTech, subject to the vaccine successfully completing all clinical trials and passing regulatory approvals in New Zealand, say Research, Science and Innovation Minister Megan Woods and Health Minister Chris Hipkins. ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • International statement – End-to-end encryption and public safety
    We, the undersigned, support strong encryption, which plays a crucial role in protecting personal data, privacy, intellectual property, trade secrets and cyber security.  It also serves a vital purpose in repressive states to protect journalists, human rights defenders and other vulnerable people, as stated in the 2017 resolution of the ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ministry of Defence Biodefence Assessment released
    The Ministry of Defence has today released a Defence Assessment examining Defence’s role across the spectrum of biological hazards and threats facing New Zealand. Biodefence: Preparing for a New Era of Biological Hazards and Threats looks at how the NZDF supports other agencies’ biodefence activities, and considers the context of ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020
    New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020 Hon David Parker’s response following Thomas Piketty and Esther Duflo. Good morning, good afternoon, and good evening, wherever in the world you might be. I first acknowledge the excellent thought provoking speeches of Thomas Piketty and Esther ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Kaipara Moana restoration takes next step
    A Memorandum of Understanding has been signed today at Waihāua Marae between the Crown, local iwi and councils to protect, restore and enhance the mauri of Kaipara Moana in Northland. Environment Minister David Parker signed the document on behalf of the Crown along with representatives from Ngā Maunga Whakahī, Ngāti ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New Zealand and Uruguay unite on reducing livestock production emissions
    Agriculture Minister Damien O’Connor and Uruguayan Minister of Livestock, Agriculture and Fisheries Carlos María Uriarte have welcomed the launch of a three-year project that will underpin sustainable livestock production in Uruguay, Argentina, and Costa Rica.  The project called ‘Innovation for pasture management’ is led by Uruguay’s National Institute of Agricultural ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • 3100 jobs created through marae upgrades
    Hundreds of marae throughout the country will be upgraded through investments from the Provincial Growth Fund’s refocused post COVID-19 funding to create jobs and put money into the pockets of local tradespeople and businesses, Regional Economic Development Minister Shane Jones and Māori Development Minister Nanaia Mahuta have announced. “A total ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Health volunteers recognised in annual awards
    Health Minister Chris Hipkins has announced 9 teams and 14 individuals are the recipients of this year’s Minister of Health Volunteer Awards.  “The health volunteer awards celebrate and recognise the thousands of dedicated health sector volunteers who give many hours of their time to help other New Zealanders,” Mr Hipkins ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community COVID-19 Fund supports Pacific recovery
    The Minister for Pacific Peoples, Aupito William Sio says a total of 264 groups and individuals have successfully applied for the Pacific Aotearoa Community COVID-19 Recovery Fund, that will support Pacific communities drive their own COVID-19 recovery strategies, initiatives, and actions. “I am keen to see this Fund support Pacific ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community benefits from Māori apprenticeships
    Up to 50 Māori apprentices in Wellington will receive paid training to build houses for their local communities, thanks to a $2.75 million investment from the Māori Trades and Training Fund, announced Employment Minister Willie Jackson today. “This funding will enable Ngāti Toa Rangatira Incorporated to provide its Ngā Kaimahi ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Training fund supports Māori jobseekers
    Rapidly growing sectors will benefit from a $990,000 Māori Trades and Training Fund investment which will see Wellington jobseekers supported into work, announced Employment Minister Willie Jackson today. “This funding will enable Sapphire Consultants Ltd. to help up to 45 Māori jobseekers into paid training initiatives over two years through ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ruakura Inland Port development vital infrastructure for Waikato
    The Government is investing $40 million to develop an inland port at Ruakura which will become a freight super-hub and a future business, research and residential development for the Waikato, Urban Development and Transport Minister Phil Twyford, and Māori Development Minister Nanaia Mahuta announced today. The funding has been has ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Appointments made to Defence Expert Review Group
    Defence Minister Ron Mark announced today the establishment of an Expert Review Group to review a number of aspects of the New Zealand Defence Force’s (NZDF) structure, information management and record-keeping processes.  The Expert Review Group’s work arises out of the first recommendation from the Report of the Government’s Inquiry ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • No active community cases of COVID-19
    There are no active community cases of COVID-19 remaining in the country after the last people from the recent outbreak have recovered from the virus, Health Minister Chris Hipkins said today. “This is a big milestone. New Zealanders have once again through their collective actions squashed the virus. The systems ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Clean energy upgrade for more public buildings
    More public buildings will be supported by the Government to upgrade to run on clean energy, the Minister for Climate Change James Shaw announced today. Minister Shaw announced that Lincoln and Auckland universities will receive support through the Clean-Powered Public Service Fund to replace fossil fuel boilers. Southern, Taranaki, and ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Schools back donations scheme for the second year
    More schools have opted in to the donations scheme for 2021, compared to 2020 when the scheme was introduced. “The families of more than 447,000 students will be better off next year, with 94% of eligible schools and kura opting into the scheme,” Education Minister Chris Hipkins said. “This is ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Ruapehu cycle trails gets PGF boost
    The spectacular Mountains to Sea cycle trail in Ruapehu District will receive $4.6 million in funding from the Provincial Growth Fund for two additional trails, Regional Economic Development Minister Shane Jones announced today. “This is an exciting development for the local community, and one that will provide significant economic opportunities ...
    BeehiveBy beehive.govt.nz
    3 weeks ago