Nearly $2 of every $5 swallowed by the Government
“The 2018/19 financial statements show a Government sucking up economic output and leaving more room for tax cuts,” says ACT Leader David Seymour.
“This year, the first year that truly reflects the current Government’s fiscal and economic management, Crown Revenue has increased $9.3 billion from last year to 39.8% of GDP, of which $6.2 billion is an increase in tax revenue.
“The 2018/19 financial statements show a trend that is counter to New Zealanders’ interests as global headwinds accumulate. At all times, but especially when external pressures are greater, the Government should be focused on competitiveness. Instead we’re seeing the Government take more from the economy leaving less room for the private sector.
“Expenditure as a percentage of GDP is up as Government spending charges ahead in spite of softer economic growth. Last year Government Expenditure amounted to 36 per cent of GDP. This year the figure is up 1.1 per cent to 37.1 per cent of GDP.
“The Government’s financial statements for the year to June 30 show a Government committed to low quality spending as economic storm clouds loom.
“Altogether we have a Government that is happy to splash the cash, but the result is a commercial sector with less and less room to move. A more sensible option would be to remove the billions of low-quality spending implemented by the Government and implement ACT’s flat tax policy of 17.5 per cent personal and company tax. THAT would get the economy going.”