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Don Brash's Tax Problem

Don Brash's Tax Problem
Jim Flynn, Fri 25 Jul 2003

Don Brash believes the well-off are over taxed and fears they may flee New Zealand. He points out that someone earning $25,000 with a non-earning partner and two young children pays almost no tax - after getting Family Support and Child Tax Credit. While someone with the same family on $100,000 would pay some $30,000 in tax.

Brash's friend has an easy solution. If she donates $45,000 to charity, she too will have $25,000 in hand to raise a family - well actually a bit more because she will get a $610 tax rebate. Both families will pay about $3175 in GST, of course, thanks to Brash and his ilk.

The well-off family may now realize just how necessary family support is for most people - and wonder where the money for it will come from if we cut taxes on the rich. Both will realize how much harder it is to save for retirement if you have $25,000 for your family - rather than the paltry $70,000 you would still have to spend out of a salary of $100,000.

Brash himself has not fled New Zealand to whatever country will tax him least. Perhaps he has some affection for the place and puts that above an extra few thousand dollars. The Alliance wishes he was more concerned about the large number who really are leaving New Zealand. The students burdened with debt, the doctors who tell us they can no longer bear to work in a health system that forces them to decide who will die because of lack of money.

The solution to the flight of the best new Zealanders is not a bonus to those who put greed above country - but relief for those alienated by the lack of a more progressive tax system and the health and education it could finance.

Prof. Jim Flynn

Alliance Finance Spokesperson


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