You Can’t Tax Your Way To Prosperity
“The Government will try and leverage whatever comes out of the IRD’s tax study into a reason to take more money from Kiwis. No one has ever taxed their way to prosperity though, the Government needs to cut its own waste before it looks for more revenue, and cut red tape that makes live so expensive,” says ACT Leader David Seymour.
“David Parker’s study is a politically driven fishing expedition to find people with money and take it from them. It’s no coincidence that it was passed under urgency before an election, and with Jacinda Ardern’s promise to not enact a Capital Gains Tax (CGT) now void and IRD staff already preparing papers on capital gains, Labour is zeroing back in on implementing a CGT.
“People should ask themselves, would they accept a Government that used such intrusive powers to find out what beneficiaries spend their money on, or middle income households? Why, then, is it ok to go after people if they have money? How, then, does it fit with Kiwi values to only go after people if they’re successful?
“We tell kids to listen to their teacher, work hard, get good grades so they can get good jobs, save their money and invest wisely. Labour says if you do all that we’ll tax you harder. It is tall poppy syndrome in the tax code.
“The study will likely show that those who get more from capital gains appear to get taxed less, but it won’t show that there are imbalances right across the entire system, such as benefits for those on the lower scale. The point is that the Government shouldn’t be trying to take more money from anyone, they should be addressing their own wasteful spending and making sure New Zealand is a place that encourages investment and a strong economy.
“There are major problems in New Zealand society; health, education, roading infrastructure – the Government is spending a billion dollars a week more than when Labour entered office and all of these areas have gotten worse and worse. The issue isn’t tax revenue, it’s wasteful government spending.
“As a recent report for tax consultancy Oliver Shaw shows, 23 per cent of taxpayers contribute 77.8 per cent of tax. Those earning over $180,000, less than two per cent of taxpayers, pay a massive 9.3 per cent of income tax. Working Kiwis are taxed heavily, they just can’t keep up with the Government’s out of control spending.
“New Zealand is not a wealthy country which is why our health and education systems are failing and our infrastructure is breaking. Taking more money from New Zealanders for the Government to waste isn’t going to make the country any wealthier, all it really means is the Government thinks it is better at spending your money than you are.
“The challenges New Zealand faces can be addressed. But in order to do that there needs to be a strong economy built around creating conditions for prosperity, giving people the opportunity to get ahead.
“The growth needed to lift incomes is strangled by too much regulation and red tape. ACT will get rid of it, whether it’s RMA regulations making it too hard to use land and discouraging investment, productivity-sapping workplace relations laws making it impossible to employ staff, or banking laws like the CCCFA that make it too hard to get finance.
“A CGT won’t address any of the issues in New Zealand’s society. It will make people less aspirational and less likely to invest in an economy that needs to grow.
“We need to put the values of aspiration in our tax system, making it fairer, simpler and more competitive. It’s not only possible, it’s essential.”