Hon. Bill English MP
National Party Finance Spokesman

13 December 2006

Missed opportunity on tax

National Party Finance spokesman Bill English is describing Michael Cullen's cryptic messages on personal tax rates as an admission that Labour will empty the bank to buy votes ahead of the next election.

"Labour missed a golden opportunity in the 2004 and 2005 years when inflation was under control, the country was running large surpluses, and they had the chance to rein in government spending.

"Dr Cullen tragically let that opportunity go begging, and now he is all but admitting personal tax cuts are not on his agenda because of the inflationary corner he is in.

"There is no doubt that Labour's spending binge ahead of the last election is at least in part to blame for the inflation problem which Dr Cullen is now using as an excuse to hold off on tax announcements until election year.

"Dr Cullen is signalling he can't afford personal tax cuts, but we know he will have emptied the cupboard of the tax-funded surpluses come election time."

Mr English says National remains committed to lowering taxes over time, but admits the "sweet spot" of last year is unlikely to present itself again in 2008.

"National will carefully balance the urgent need for a fairer tax structure with the high priority we place on quality social spending, particularly in health and education. But having said that, National remains focused on making tax reductions the normal business of government in a growing economy.

"That's something the Helen Clark-led Government will never deliver."

ENDS

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