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Deputy Prime Minister Fails Tax Test

Media Release


28 July 2000


DEPUTY PRIME MINISTER FAILS TAX TEST


“The Deputy Prime Minister and Minister of Economic Development is continually castigating the oil companies for either increasing fuel prices or not bringing them down, said New Zealand First’s Energy Spokesperson, Peter Brown MP.

“Whilst, I compliment him for continually applying pressure to the oil companies he makes no attempt whatsoever to address the issue of the extra GST the Government gets as a result of prices increasing. This amounts to several cents per litre and could easily be passed back to the motorist. It is estimated at present to equate to some $60-100million extra tax per year.

“In a question in the House yesterday I asked the Deputy Prime Minister whether he would recommend reducing the tax take, putting the extra tax into roading or public transport or if it was his intention to continue the ‘all talk no action’ approach.

“He answered by stating that as prices rise so to do tax income streams and the Government loses as much or more revenue due to reduced tax income from reduced expenditure from other sources.

“He is exactly right of course which is why I asked him to at least consider reducing the cost to motorists by reducing the windfall tax he is gaining.

“I can only conclude he does not fully understand the situation or he works on the basis of saying one thing and doing another (in this case nothing),” concluded Peter Brown.


ENDS

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