ACT Leader John Banks
April 9 2013

Introduce a 20 per cent tax for everyone, not just exporters

New Zealand First’s policy to offer a lower tax rate of 20 per cent to exporters only is a half-baked idea best fed to the dog, ACT Leader John Banks said today.

“ACT has always believed that lower taxes are the best way to boost our economic performance, but this is a classic example of a political party picking winners to further its own agenda,” Mr Banks said.

“Why give a tax privilege to exporters, but not to the equally valiant manufacturers competing locally with imports? To fail to treat them equally is inconsistent with New Zealand First’s professed concern to export more and import less.

“Unlike New Zealand First, ACT believes that everyone would benefit from lower taxes, not just exporters.

“A recent Treasury and IRD paper found that personal income tax reductions would be the most effective measure for boosting economic welfare.

“ACT would like to see a 20 per cent tax rate rolled out across the board so that families, individuals and businesses can all benefit. But to do that we must cut out wasteful government spending.

“If core crown expenditure is reduced to 29 per cent of GDP, a tax rate of 20 per cent along with 15 per cent GST would be more than enough to fund government spending, with a substantial welfare safety net.

“If New Zealand First is really serious about boosting economic growth, they should support a lower tax rate of 20 per cent for everyone coupled with lower government spending, rather than picking specific groups to bestow government privileges on,” Mr Banks said.

ENDS

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