The size of Grant Robertson's hole has been revealed, and the optimistic numbers National was throwing around before the election, are proving to be just that - optimistic. In August last year, during the election campaign, National announced it was going to fund $14.6 billion worth of tax relief, and it was going to pay for it by re-prioritising spending and introducing targeted revenue measures like a new foreign buyer tax on some houses.
You will recall the ‘Back Pocket Boost’ package - it included changes to income tax brackets to compensate for inflation, introducing Family Boost childcare tax credit and increasing Working for Families tax credits. It's all coming in July 1st this year.
According to National, that would mean an average household with children with an income of $120,000 would be better off by $250 a fortnight, Labour said that's absolute tosh, that 99% of Kiwi households would not get that $250, only 0.18% of them would. National said don't care, doesn't matter. An average household with no children will get up to $100 per fortnight, a full-time minimum wage earner will get $20 per fortnight. Whoop, open the champagne. And a super annuitant couple would get $26 more per fortnight. And when they were quizzed about how they were going to pay for that, when National was saying too that Labour had spent all the money, they talked to their targeted revenue measures like the foreign buyer tax on some houses, like the plan to raise revenue from online gambling.
So, all very well and good, and obviously it was attractive for people doing it tough. Attractive enough for some people to tick blue, to put National in the driver's seat when it came to forming a government. Other people ticked blue because of the claw back on the landlords able to claim interest deductibility. However, IRD put up its own costings when it came to the online gambling revenue and that came in vastly lower than what National envisaged prior to the election. That means that over the four-year forecast period, the gap between National's pre-election costings and the IRD's works out at more than 500 million - which is the second blowout the government’s had with news last Monday that the government's reinstatement of aforementioned interest deductibility would come in at $800 million more than National had costed at the election, mainly because of the horse-trading with ACT during the coalition talks.
So, all the numbers are coming in, it's worse than we thought. There's only so much you can do when it comes to public service cuts. You're not going to get as much money as you thought, but a lot of people knew that at the time. You know, everybody was saying there just aren't going to be enough foreign buyers paying that tax to help cover the cost. IRD said the online gambling revenue is vastly optimistic. It said it at the time - it's done the costings now. So why don't we just call it? We cannot afford the tax cuts. We could never afford the tax cuts. We knew we couldn't afford it. We didn't vote in National because we wanted an extra $100 a fortnight, did we? We voted for National, we voted for ACT, we voted for the Greens because they weren't Labour.
The Greens got their largest share they've ever had of the vote and saw more MPs in Parliament than they've ever had. That hasn’t aged well, but nonetheless they got their biggest share of the vote in their party's history because they weren't Labour. Because the people who could not vote for any of the right-wing parties couldn't vote Labour. ACT went up, National went up. New Zealand First were returned to Parliament because people were not going to vote Labour. That's why we have the government we have. People were not a ‘hundy’ on National and ACT’s promises and policies. They were certain, though, that they didn't want the previous administration to continue.
So, do we concede that there is no way we can afford the tax cuts? We've got to get the hospitals sorted, the police have to be paid properly, there's a million claims on that money. The promise of tax cuts was surely just a Trojan horse to get National back into power. But didn't we know this?
You know you can't run a campaign saying hey, vote for us, we're not Labour. You have to come up with something. So did you vote for the current administration because you wanted, you expected, a tax cut? A tax cut was promised to you, you've voted accordingly and you want that bloody tax cut? You want them to keep their promise? Or do you accept that the price of an extra $100 a fortnight, the price of an extra $26 per fortnight is simply too high to pay with the country in the state it's in?
Kerre McIvor, is a journalist, radio presenter, author and columnist. Currently hosts the Kerre Woodham mornings show on Newstalk ZB - where this article was sourced.
You will recall the ‘Back Pocket Boost’ package - it included changes to income tax brackets to compensate for inflation, introducing Family Boost childcare tax credit and increasing Working for Families tax credits. It's all coming in July 1st this year.
According to National, that would mean an average household with children with an income of $120,000 would be better off by $250 a fortnight, Labour said that's absolute tosh, that 99% of Kiwi households would not get that $250, only 0.18% of them would. National said don't care, doesn't matter. An average household with no children will get up to $100 per fortnight, a full-time minimum wage earner will get $20 per fortnight. Whoop, open the champagne. And a super annuitant couple would get $26 more per fortnight. And when they were quizzed about how they were going to pay for that, when National was saying too that Labour had spent all the money, they talked to their targeted revenue measures like the foreign buyer tax on some houses, like the plan to raise revenue from online gambling.
So, all very well and good, and obviously it was attractive for people doing it tough. Attractive enough for some people to tick blue, to put National in the driver's seat when it came to forming a government. Other people ticked blue because of the claw back on the landlords able to claim interest deductibility. However, IRD put up its own costings when it came to the online gambling revenue and that came in vastly lower than what National envisaged prior to the election. That means that over the four-year forecast period, the gap between National's pre-election costings and the IRD's works out at more than 500 million - which is the second blowout the government’s had with news last Monday that the government's reinstatement of aforementioned interest deductibility would come in at $800 million more than National had costed at the election, mainly because of the horse-trading with ACT during the coalition talks.
So, all the numbers are coming in, it's worse than we thought. There's only so much you can do when it comes to public service cuts. You're not going to get as much money as you thought, but a lot of people knew that at the time. You know, everybody was saying there just aren't going to be enough foreign buyers paying that tax to help cover the cost. IRD said the online gambling revenue is vastly optimistic. It said it at the time - it's done the costings now. So why don't we just call it? We cannot afford the tax cuts. We could never afford the tax cuts. We knew we couldn't afford it. We didn't vote in National because we wanted an extra $100 a fortnight, did we? We voted for National, we voted for ACT, we voted for the Greens because they weren't Labour.
The Greens got their largest share they've ever had of the vote and saw more MPs in Parliament than they've ever had. That hasn’t aged well, but nonetheless they got their biggest share of the vote in their party's history because they weren't Labour. Because the people who could not vote for any of the right-wing parties couldn't vote Labour. ACT went up, National went up. New Zealand First were returned to Parliament because people were not going to vote Labour. That's why we have the government we have. People were not a ‘hundy’ on National and ACT’s promises and policies. They were certain, though, that they didn't want the previous administration to continue.
So, do we concede that there is no way we can afford the tax cuts? We've got to get the hospitals sorted, the police have to be paid properly, there's a million claims on that money. The promise of tax cuts was surely just a Trojan horse to get National back into power. But didn't we know this?
You know you can't run a campaign saying hey, vote for us, we're not Labour. You have to come up with something. So did you vote for the current administration because you wanted, you expected, a tax cut? A tax cut was promised to you, you've voted accordingly and you want that bloody tax cut? You want them to keep their promise? Or do you accept that the price of an extra $100 a fortnight, the price of an extra $26 per fortnight is simply too high to pay with the country in the state it's in?
Kerre McIvor, is a journalist, radio presenter, author and columnist. Currently hosts the Kerre Woodham mornings show on Newstalk ZB - where this article was sourced.
5 comments:
This government is not going through the government costs line by line hard enough in my opinion. We need to get rid of half of the useless govt departments that do nothing e.g the ministry for women, pacific affairs etc. We need to follow the likes of Javier Milel
Perhaps I’m in a distinct minority, but I voted for the centre right at the last election *despite* the promise of tax cuts, not because of them. If we don’t support social services collectively, we’ll simply be hit with paying for them individually, possibly when we can least afford it. Plus I feel that government is not just about me, it’s about the good of the country as a whole – I know, crazy, right?
But despite that, not Labour. Hell no! I had come to loathe Labour with deep intensity. For one thing, Labour was proving itself more and more incompetent in its basic task of running the country: squandering government funds on big new agencies with managers on huge salaries, agencies that were achieving next to nothing for the benefit of New Zealanders. The opening of the government books post-election proved without a doubt how utterly incompetent Labour had been in office. And as for Labour’s political allies, they were to be the radical, pseudo-environmental, identity-politics wielding Greens and the radical, race-based, uncouth TPM. These allies were only going to drag Labour further and faster into anti-democratic, race-based policies.
For me it was back to a “which party is least worst?” sort of vote. The answer, though, wasn’t difficult!
LFC
Absolutely we do. The income bands lost their relevance at least 15 years ago. I’ll concede changing these is unaffordable when the govt can prove they have cut every wasted dollar, including that going to NZME to help keep Kerry in the lifestyle to which she has become accustomed. Losing one third of your income when you hit $48k is unconscionable and tantamount to theft.
It's all about the dignity of work , the dignity of self reliance, the dignity of personal responsibility. These personal characteristics happen to be some of the major building blocks of Western democracies.
A lot of people don't get it. Certainly socialists like Labour , the Greens and the Maori Party don't. But this Coalition Government certainly does.
Why should a supermarket checkout worker pay middle income tax on their upper earnings ? And then depend on a social welfare payment to feed the kids ? Other than it makes them beholden to a social welfare system . And an enormous army of bureaucrats involved in this senseless recycling of their wages.
Labour loves social welfare , it helps them control peoples lives , makes people dependent on the Government for their daily bread. That's why they paid for control of MSM's independence and integrity. These are two of the major building blocks of socialist totalitarian states.
It's as simple as that Kerre. Just go ask a supermarket checkout worker what they think about an extra $20.00 per fortnight in their pay packet.
Perhaps you did not hear Nicola Willis yesterday morning discuss the tax cuts . They will be delivered as promised.
It may be a long road back from the devastation left by Labour, but one step at a time .
We need a simple referendum.
There 18,000 more bureaucrats now than 2016. If you look at their remuneration and support costs office airfares etc etc a fair estimate would be $250k/person so 18,000x$250k comes to $4.5B/yr.
The question should: tax cut of $4.5B or 18,000 bureaucrats.
See what the outcome would be.
As a secondary point the tax cuts tend to grow the economy and revenue so a fiscally neutral bureaucrats for tax cuts would reduce the deficit dramatically.
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