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Surplus should be spent on social goods

Alliance Party media release for immediate release Wednesday 11
October 2006

Alliance Party says surplus should be spent on social goods

Alliance Party taxation spokesperson Professor Jim Flynn says the larger than expected budget surplus of $11.5 billion should be used to overcome poverty, health issues and student debt.

"There is no surplus in reality – the so called surplus represents a serious lack of investment in our social needs, illustrated by hospital waiting lists, a lack of funding in education, and the poverty and insecurity of many New Zealanders."

Professor Flynn says the Alliance supports a progressive tax system that removes the tax burden from those on lower incomes.

"Tax is a good if it provides the resources for the community to fund the basics of a civilized community, and if it ensures a fair and equitable distribution of wealth."

He says that generalized tax cuts will be of little use to low and middle income people, who will be better served by an improvement in free public services provided to all New Zealanders.

"That means a large increase in the resources dedicated to educating our young people to their fullest potential, and ensuring we have a healthy population – this is both the practical and the morally right course of action."

"National and Labour will try to compete with tax cuts for the wealthy, whereas the Alliance says that we should use this money to provide real benefits to the people of New Zealand."

Professor Flynn says the Alliance supports major changes to the tax system to benefit most people.

"We would phase out GST, starting with food, and remove all income tax from the first $10 000 of income, to provide immediate relief for lower income New Zealanders struggling with rising living costs."

The Alliance would raise income tax on incomes over $50 000 and introduce a financial transactions tax to fund its social goals.

ENDS

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