6 MARCH 2018
Wealth tax would be a mistake
The decision by the Tax Working Group, chaired by Sir Michael Cullen, to consider the introduction of a wealth tax is a dangerous step, says the New Zealand Taxpayers’ Union.
Taxpayers Union Economist Joe Ascroft says “New Zealand is a relatively poor country, with low wages, and limited productivity growth. Lifting wages, which would enable all New Zealanders to live more comfortable and prosperous lives, requires strong levels of investment and economic growth. The problem with a wealth tax is that it encourages people to spend the wages they earn, rather than save, invest and build wealth for themselves and their family.”
“A wealth tax is emotively appealing, but when households around the country choose to save less, start fewer businesses, and invest a reduced proportion of their income, long term economic growth will slow, and wages will stagnate.”
“Policies like a wealth tax, or indeed any tax which discourages investment, rob from the future paycheques of young New Zealanders to pay for lavish and wasteful social spending today. That’s an unacceptable trade-off.”
The Taxpayers’ Union will be presenting more in-depth commentary on the Tax Working Group's proposals as they emerge.