ACT Finance spokesman Rodney Hide said today that the Government’s special “fund withdrawal tax” broke Labour’s promise of no new taxes.

“Cullen told businesses there would be a tax hike to 39 cents but no new taxes. Within months of taking office, he’s announced a new tax.

“The new tax is five percent of the amount withdrawn from an employer contribution super scheme, unless the employee is leaving the job or withdrawing for reasons of hardship.

“This is a new tax. Once again, we see Labour’s promises as just puffery.

“The new tax will make the tax system more complex, is unfair and discriminatory, and is totally unnecessary. The problem is a direct consequence of Dr Cullen stupidly hiking the top rate to 39 cents. Everyone warned him of these problems when he pushed his tax legislation through the House under urgency last year. He refused to listen.

“Now we have even more legislation trying to patch up a mistake that we didn’t need to have.

“I have no doubt that Cullen will be still tinkering with our tax laws in a year’s time as a consequence of the mess he’s made in his foolhardy and unnecessary hike in the top rate of tax to 39 cents,” said Rodney Hide.

ENDS

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