Hon Dr Michael Cullen
Minister of Finance

1 September 2008 Media Statement

Key cancels 2011 tax cuts

John Key has inadvertently admitted that National would not deliver more rounds of tax cuts than Labour, but will instead just change the ordering of the government’s three-staged $10.6 billion tax cut programme, Finance Minister Michael Cullen said.

In a press statement today announcing National’s billboard campaign, John Key said if elected National would keep in place the first round – which will be delivered on 1 October – and then would cut taxes again in 2009 and 2010. The government will cut taxes in 2010 and again in 2011.

“This is nothing more than smoke and mirrors from National. John Key made a big song and dance about adding an extra round of tax cuts to the current financial year,” Dr Cullen said.

“He created the impression that this would be an extra round, and that he would follow Labour’s plan from there, cutting taxes again in 2010 and 2011. Thanks to Mr Key’s slip today, we now know that all he plans to change is the ordering of the tax cut programme. This is pretty cynical politics from the National leader.

“With global inflation a problem for economies all over the world, the Labour-led government thinks adding an extra round of stimulus in the current financial year would be a risky move for our economy.

“It is also clear that Mr Key plans to deliver less in tax cuts to lower and middle income New Zealanders in order to pay for tax cuts at the top of the income scale. He needs to admit that is what he will propose so we can have a fair debate on these issues.

“In the mean time, Mr Key should explain why National’s new billboards seem to have people flying to Chile rather than Australia. And why are they travelling by World War II bomber fleet?”

ENDS

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