John Key MP
National Party Finance Spokesman

19 October 2006

Govt tax take outstrips local body rates rises

The increase in the Labour Government's tax take over the past six years has far outstripped even the hefty rises in local body rates over the same period, says National Party Finance spokesman John Key.

Figures produced by National show that over the past six financial years the tax take has increased by 62%, compared to 45% for local body rates.

In the 1999 financial year the total central government tax revenue was $30.2 billion. In 2006 it was $52 billion.

"The increase in local body rates is bad enough - with a rates revolt and an independent inquiry planned - but the increase in the central government's tax take by Michael Cullen is another disgrace," says Mr Key.

"This Government is happy to have an independent rates review, but it is not happy to review its own massive tax take.

"In the last financial year alone, the tax take has risen 11.5% compared to an increase of 7.1% in total local body rates.

"As the OECD has pointed out, Dr Cullen and the Labour Government have overseen our fall from 10th to 16th in the OECD rankings for tax revenue as a percentage of GDP.

"This fall into the bottom half of the OECD shows we are going backwards by not ensuring that the economy is globally competitive. Dr Cullen is failing in his responsibilities to New Zealanders."

ENDS

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