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Dr Cullen left Looking like an Ostrich, says Birch

Rt Hon Sir William Birch
Minister of Finance and Minister of Revenue

25 November 1999
For Immediate Release

Dr Cullen left Looking like an Ostrich, says Birch

Dr Michael Cullen looked like a silly ostrich when he put his head in the sand today and tried to deny that tax reform in Australia will give them improved competitive advantage, Finance Minister Sir William Birch said today.

“Dr Cullen asserts that because Australia’s reforms are revenue neutral, they cannot confer any advantage on Australia firms. I am astonished that a finance spokesperson from any party could confess to such blinding stupidity.

“The Australians are abolishing some highly distortionary accelerated depreciation allowances, and they are using the money saved by that change to slash their corporate income tax rate to 30 cents.

“On the one hand, they will stop rewarding inefficient business decisions driven by a distorted approach to depreciation. On the other hand, lower corporate rates increase the reward and incentive to firms for quality decision making.

“Getting the incentives right is fundamental to a good tax system. We all know that. But Dr Cullen’s commitment to impose higher taxes on New Zealanders is blinding him to the simplest fundamentals of good competitive tax design.

“If he wants to put his head in the sand and leave his rear end wide open to international attack, that’s his business. But the rest of us would have to be mad to imitate that silly and self-destructive and behaviour,” Sir William said.


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