28 August 2000

SHIFT TO POLLUTION TAXES INEVITABLE

United New Zealand leader, Hon Peter Dunne, says a shift to pollution based taxes is inevitable.

Mr Dunne says comments from former Treasurer Bill English in favour of pollution taxes should therefore come as no great surprise.

"The limits on taxing corporate and personal income are becoming more obvious day by day."

"Not only are there limits on how much income tax can be imposed, but as the whole Winebox debate has shown, there is huge controversy about both defining income for tax purposes and ways of avoiding existing tax rules."

"Green taxes are much more straightforward and difficult to avoid."

"Because they tax consumption, they are arguably more efficient," he says.

Mr Dunne predicts that in time the New Zealand tax system will rely less on income related taxes, and much more on consumption taxes, on goods and services (the current GST) and resources.

"The trick will be getting the balance right, minimising the inflationary effects of a change, and making the transition."

"In the words of Rachel Hunter, 'It may not happen overnight, but it will happen!'" he says.

ENDS

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