I don’t care aboutÂ any other policy when I vote than the comparative taxation rates. Â The rest of the election issues are woolly woofter nonsense to me. Â The lower the tax rate the better, which is counter-intuitive for someone in my industry as the size of my wallet depends entirely on people wanting to find solutions to paying these higher taxes. Â Lower tax makes us redundant.
Bill English loves tax. Â He must do as in his time as Finance Minister he has not once looked like making the slightest amount of tax reform that New Zealand needs to make it more internationally competitive.
So when ACT released their company rate policy to slash company tax from 28% to 12.5% it was immediately poo-pooed by the farmer from Dipton.
“You can’t open up too big a gap between the company tax rate and the personal tax rate. You just invite people to dodge taxes by setting up structures that make them look like companies instead of people.”
So the top tax rate on individuals is 33% and the company tax rate in New Zealand now is 28%. Â The trust rate is 33%. Â There currently is a 5% differential between a company rate and the top individual rate.
Thing is, all his farming mates (including himself) actually can and have paid less taxes by setting up structures that make them look like companies instead of people. Â You know, the married couple on a small farm who operate it themselves. Â Everyone knows what they are doing when they set up a structure in this way. Â It is to pay less tax.
But Bill of course doesn’t want anyone else to be able to do this.
Well I have news for him. Â Everyone who can do this already is. Â And the salary and wage earners in New Zealand cannot actually tell their bosses they want to be contractors and set up companies so they never will be able to take advantage of it.
ACT of course needs to now come out and say that they have taken the Finance Minister’s fabulous advice and propose that company and individual tax rates should be the same – 12.5%. Â That’s what their policy at the last election was and it was a damn good one. Â A growing proportion of New Zealanders are not even net taxpayers at all. Â Why should the already beaten up middle classes take the brunt of excessive government spending. No matter if it is packaged in Bill English blue or David Parker red?