Ineptitude

Colin Espiner picks up on the "tax cuts" we are supposed to be enjoying


New Zealand, world, sport, business & entertainment news on Stuff.co.nz
Colin Espiner "blogs" about the change in talk Labour has used over Working for Families, tax credits, tax cuts, welfare.

[quote]Campaigning on its record is a legitimate enough tactic, but it’s going to take more than this to convince voters to give it another chance. Labour knows this, which is why it has been slowly changing its position on tax cuts from “absolutely not” to “yes, definitely”.

This was nicely demonstrated in the House today, when Clark answered a question by National’s deputy leader Bill English about why she said three years ago that tax cuts were unaffordable and would inevitably lead to cuts in public services: “I’m pleased to say the economy is now much stronger and we have many more options.”

This follows increasingly heavy hints in recent days by Treasurer Michael Cullen, whose constant promise of jam tomorrow has become a familiar refrain.
The other noticeable change from Labour is that it’s started referring to practically any form of tax relief, rebate, or credit as a “tax cut”.

Hence, Clark and Cullen have claimed of late that the Government has delivered “billions of dollars worth of tax cuts” to hard-working Kiwis over the past nine years.
This is no doubt news to many, given the Government’s tax take has virtually doubled since 1999 and many people are paying more tax now than they were when Labour came to office.

But Labour now includes Working for Families as a de facto tax cut, despite the fact that in many cases those receiving substantial sums actually pay no tax at all or even receive more than they pay to start with.
This is getting ridiculous.

One might as well refer to those on the unemployment benefit as receiving a tax cut. Or anyone visiting the doctor, receiving a pension, a free education, or any other form of government assistance. None of these are tax cuts. All involve the state taking income from those that earn it and redistributing it as it sees fit.
That’s fine – all governments do it. But Labour should call a spade a spade. Trying to dress up Working for Families as tax cuts in drag is not going to hoodwink the public, particularly those without children or on high incomes who get nothing from WFF.

It also makes it plain that National has won the argument on tax cuts, which Labour used to argue were unaffordable when the economy was in stronger shape than it is now, and that the public weren’t interested anyway when surveys plainly indicated the opposite.

It’s about time Labour stopped its tax cuts striptease, outlined its policy, and then challenged National to do the same. Perhaps then we could agree on this and move on to some of the other challenges the country faces? [/quote]

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Gee didn't ya know we have enjoyed sustantial tax cuts under Labour

( Uncorrected transcript—subject to correction and further editing

I’m no expert but I reckon Helen Clark has misled the house with this exchange.
[quote]John Key: Is the Prime Minister aware that in 1999 only nine countries in the OECD had a lower tax burden than New Zealand but that by 2005 it was 17 countries, and that under her leadership she certainly has got New Zealand into the top half of the OECD—the half that pays a lot more tax?

Rt Hon HELEN CLARK: I am advised that taking into account a one-off change our tax revenue as a proportion of GDP sits at around the OECD average and puts us in the same bracket as the United Kingdom.

John Key: Is the Prime Minister concerned that for the last 5 years the Australian Federal Government has embarked on a programme of lowering personal taxes, and that we have now seen both the Labor Party and the Liberal Party in Australia promising large future personal tax cuts; and does it not worry her that that gap between New Zealand and Australia for after-tax income continues to widen because of those tax cuts, and for how long can New Zealand ignore this problem?

Rt Hon HELEN CLARK: As has been said many times, this matter will be addressed in next year’s Budget.

John Key: Why is the Prime Minister telling New Zealanders that for 8 years the Government has been roughly running large surpluses, that the inflation environment in many of those years has been low, but that, miraculously, the only time a Labour Government in New Zealand will ever talk about tax cuts is election year, and does she not think that looks a little bit desperate?

Rt Hon HELEN CLARK: Of course, the Government has enabled families to have substantial tax cuts, it has cut taxes on savings, and it has made substantial tax cuts on business to encourage economic growth.

Hon Dr Michael Cullen: Given the Leader of the Opposition’s enthusiasm for the Australian tax scales and rates, will the Prime Minister be expecting from him support for lifting the top tax rate, introducing a capital gains tax, and introducing stamp duty, which are all part of the Australian tax system?

Rt Hon HELEN CLARK: My experience is that the National Party borrows very selectively from Australian figures. For example, it does not want to face the fact that under a Labour Government unemployment is consistently lower than in Australia. It does not want to face the fact that under a Labour Government in New Zealand economic growth rates have outpaced those of Australia as well as the whole OECD.

John Key: Is the Prime Minister aware that in 2000 the average wage in New Zealand was roughly $34,000 and it has risen to about $44,000—that is a $10,000 increase—but that, in fact, if one takes into account the increase in inflation and the bracket creep, the average New Zealander is only $500 better off after that $10,000 increase, and is that not a bit of a insult to the average New Zealander?

Rt Hon HELEN CLARK: I would not take any of that member’s figures at face value. What I know is that for the average single-earner couple with two children in the family, the tax wedge is at the second-lowest in the OECD at 2.6 percent, compared with 13.6 percent when National led office. The National Party did nothing to reduce the tax burden on the average family.

John Key: If tax cuts have not made sense for the last 8 years, why will they miraculously make sense next year, in election year?

Rt Hon HELEN CLARK: The member should listen more carefully. There have been huge tax cuts for families under Labour, and there have been big tax cuts for business under Labour. Both those areas of tax cuts have been consistently voted against by the National Party.

John Key: Why should any New Zealander trust whatever miraculous tax cut programme Labour comes up with in election year when that all those New Zealanders will know that they are the same people who were promised tax cuts in 2005 only to have them taken off them by the same Labour-led Government?

Rt Hon HELEN CLARK: I wonder why any New Zealander would believe anything those National members said about tax cuts when they have consistently voted against every Government bill bringing in tax cuts in the House.

Rodney Hide: Does the Prime Minister accept that no OECD country has achieved 4 percent growth on a sustainable basis—which was her Minister of Finance’s goal on assuming office—with total spending above 40 percent of GDP, and if she does not accept that the tax take has an impact on growth, why not?

Rt Hon HELEN CLARK: I understand that there have indeed been countries in the OECD that have seen growth rates like that. They might perhaps be better described as emerging economies that have come more recently into a market economy system. But the last time I looked, the average amount of economic growth since this Labour-led Government took office was close to 3.4 percent a year. That was higher than Australia, higher than the US, Japan, the United Kingdom, the OECD, and the European Union average rates for that period. That is economic success, Labour style.[/quote]

Look how many times she said that Labour had brought in substantial tax cuts, this is absolutely misleading the house. Labour has not brought in one single tax cut for earners in its entire 8 years. To call tax credits, which you will note from Question 3 Michael Cullen is very careful to call their packages of welfare, tax cuts is disingenuous to say the least.

Tax Cuts the term implies at the very least that the government has cut the amount of tax it has extracted from your income, that demonstrably has not happened, in fact Labour has consistently raised additional taxes, in fact before the House now is a Bill to raise petrol taxes in regions needing public transport infrastructure.

Labour has not cut taxes, nor are they tax credits as Michael Cullen is want to call them. I’ll prove it. If you have a Community Services Card and suddenly qualify for Working for Families, which Clark calls “tax cuts” and Cullen calls “tax credits” you lose your card because Work and Income who manage the system say that Working for Families is Income. Inland Revenue doesn’t see it as income, they see it as a credit, but not Work and Income.

So what is Labour’s package of welfare for working families? Is it Tax Cuts? Categorically NO! Is it Tax Credits? Possibly, and somewhat more accurate than Clark’s rants today.

Has Clark misled the house? Absolutely she has, there is plenty of evidence to nail her on this, but will anyone bother with the patsy sock puppet that is the speaker. Margaret Wilson is the hands down winner of the Worst Ever Speaker Award. She will protect Dear Leader until the empire is ousted.

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Herald Editorial gets into Cullen

Editorial: Replace tax credits with tax cuts – 19 Oct 2007 – Opinion, Editorial and reader comments from New Zealand and around the World – nzherald

Cullens ideological hatred of tax cuts comes in for some scrutiny from the NZ Herald in its editorial.
[quote]”Not the kind of programme you would expect to see from a Labour-led Government,” Dr Cullen sniffed.

Well, not from this one. Almost its first act was to raise the top rate of personal tax not because it needed the money – the Treasury was running Budget surpluses – but because Dr Cullen, Helen Clark and Jim Anderton had been backbenchers in a Labour Government that flattened the tax scale and they were determined to restore its former bite on higher earners.[/quote]

Cullen uses phrases “tax credits” and “tax relief” which are fantastic for a wordsmith to analyse. Both phrases intimate and point to some “tax pain or too much tax in the first place if we are to receive the munificent bounty of the chosen party and Dear Leader. That’s great but why doesn’t Cullen just lesson the pain or stop taking so much, then he wouldn’t have to give us back any of our money he never needed in the first place.
[quote]This Labour-led Government likes to give selective tax favours in the form of credits, not cuts. Tax credits mean the tax is collected, flows through the system and is returned as a payment such as “family support”. Many wage earners get all their tax back in such payments. Why not leave it with them in the first place and save the cost of collecting it and processing their payments?

The reason Dr Cullen’s brand of Labour Government does not take the cheaper option is social principle. They believe universal benefits create a shared stake in the state that is socially healthy, not to say politically valuable for Labour. That is the reason tax cuts are anathema to them. We are paying a high price for their principle.[/quote]

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More like blinded by ideology

Cullen ‘misinformed’ on Australian tax cuts – New Zealand, world, sport, business & entertainment news on Stuff.co.nz

Cullen is desperately trying to back-track on his comments on the proposed Australian Tax cuts package. He claims he was “mis-informed”, heh the story of Little Mickey’s entire life.

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Liar, Liar

Cullen says too poor to cut taxes like Australia – 16 Oct 2007 – NZ Herald: New Zealand National news

Cullen lies like a flatfish in commenting on the Liberals tax largess in the opening salvo’s of the Australian election campaign.
[quote]”Not the kind of programme you would expect to see from a Labour-led government,” [/quote]
Quite right, Cullen will never, ever give us tax cuts, all he does is increase taxes. When he does promise them he reneges, the man simply cannot believed.

David Farrar shows the lies of Cullen’s statements. His comments simply cannot be supported by semblance of facts. All we get is spin and lies.

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I don't think this will work

Reserve Bank suggests floating gst – New Zealand, world, sport, business & entertainment news on Stuff.co.nz

A floating GST rate, I can’t see this working to halt inflation, not when inflation is largely fueled by excessive and poorly controlled government spending. All this measure will do is pour money into the government coffers as GST rises on necessities that people can’t avoid and will also increase the prices and thus inflation.

I think it is time for a clean out at Treasury, they are clearly bereft of ideas.

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Tax Policy stealing extra billy through bracket creep.

A report from the NZ Institute of Economic Research shows that Cullen's refusal to adjust tax brackets means he is scalping Kiwi's of an extra $1 billion un-necessarily.

Don't forget that one of Helen's famous pledge card promises when the Government introduced the 39c rate for incomes over $60,000 would be that it would affect only 5 per cent of taxpayers.

But last year nearly 12 per cent of taxpayers were in the top bracket, and they collectively contributed over half the income tax take.

In order to compensate for inflation between 2000 and 2006 the threshold up to which the 15 per cent rate applies, now $9500, would have to be raised to $11,300.

Cullen has to go, and he can take the witch with him. 

 

Happy ANZAC Day – Cop that lot

The Government is set to hike Petrol Taxes by 10c but just in Auckland and Wellington.

They have just lost the election.

And on ANZAC Day too! 

Now this is innovation in tax collection

Indian Tax collectors have come up with a novel way to collect back taxes from recalcitrant taxpayers….I can just imagine Michael Cullen getting in on this one.

They have hired Dancing and Singing Eunuchs to visits defaulters. The novel tax-collection technique kicked off Wednesday, with boisterous eunuchs loudly demanding that mortified shopkeepers pay up — to the bemusement of scores of onlookers. 

Apparently it was quite successful.

 

63% say Yeah Right Dr Cullen

A TVNZ Colmar-Brunton poll last night found 63 per cent of respondents did not believe Dr Cullen 's warnings about the fiscal consequences of tax cuts.

Effectively saying Yeah Right!!! to the History Teacher.

Of course both Cullen and Helen Clark say the poll is skewed to the right and flawed yet again shooting the messenger rather than listen to the message.

Labour has now effectively lost the tax debate. 

The other debate that has Labour in a tizzy is the priorities of spending where clearly Labour has again mis-calculated. Their vaunted Working For  Families has apparently fallen flat as has pre-funding super and roading spending. The top two priorities for Kiwis are Health and Tax Cuts.

This is clear victory to national for setting the agenda and makes it the second Cullen budget in a row to fall flat on its face.