Labour announced the membership of its Tax Working Group just before Xmas. It’s the favourite time of year for governments to make announcements when they want to avoid normal public scrutiny.
A closer look tells us why.
It is stacked 8 to 2 with corporate representatives. Here they are:
Corporate representatives:
Craig Elliffe – 14 years tax partner with KPMG and 9 years tax partner at Chapman Tripp
Joanne Hodge – former tax partner at Bell Gully
Kirk Hope – formerly CEO of New Zealand Bankers’ Association
Geof Nightingale – partner at PWC New Zealand
Robin Oliver – works for Oliver Shaw – private tax consultancy – previous worked for NZ Treasury
Michelle Redington – 13 years at PWC, now Head of Group Taxation and Insurance at Air New Zealand
Nick Malarao – senior partner and tax advisor at Meredith Connell
Hinerangi Raumati – Chairwoman of Taranaki’s biggest Maori agri-business.
Others:
Marjan Van Den Belt – Assistant Vice Chancellor (Sustainability) at Victoria University. Previously “running her own research consultancy on developing (computer-aided) decision support for public private partnerships in the USA”
Bill Rosenberg – CTU economist
This is the group Labour has set up to look at the “structure, fairness and balance” of New Zealand’s tax system.
Give us a break.
Most of these people spend their working days earning fat salaries advising wealthy corporates and rich listers how to minimise their taxes.
And it’s all chaired by our own neo-liberal former Finance Minister Michael Cullen.
What a farce!
Yes you are right here, we are suspicious of the heavy inclusion of business interests here over the lack of any real public inclusion so Jacinda needs to also include an “equal” number of public representatives on this “tax Group”
I am sure it will have dawned on the Labour Government that not much more Tax burden can be laid on the low waged workers in New Zealand. Nor on the beneficiaries and Pensioners without other income.
Neither can more GST weight be shoveled onto the low wage earners and superannuates on fixed incomes. Not to mention the vile scandalous landlords sucking the very blood out of Renters across the Land. The Ratshit Capitlist Bastards.
The Capitalists have merrily seen to all this inequality. It is their one and only achievement. They have ruthlessly freed up the wealthy (via Trusts, tax loopholes and write offs). And dumped down on the rest of the nation.
Whether Minto likes it or not Michael Cullen is an outstanding New Zealander. Talented way beyond John Minto.
The Tax Working Group is rightly composed of people who know what they are talking about. They will be tested on their ability to effectively bring back equality into NZ.
They will be a laughing stock if they do not succeed in that. I think they will succeed.! In Spite of Minto
“Michael Cullen is an outstanding New Zealander.”
Because you say so?
Hi Brigid
I hope one day I could say the same of you as I have said of Michael Cullen.
Or have I left that too late ?
I like your clever use of “observer” in your user name. It distances you from the issues being debated and is intended to imply objectivity.
Doesn’t work, mate.
A common monkey trick of neo-liberals world wide.
As are your silly cheerleader comments on Scrooge McCullen…
Change always comes from the fringes, never from Micheal Cullen…
Micheal Cullen is a gatekeeper for lies for the private bankers.
That’s the same Michael Cullen who doesn’t know that banks create money when they extend loans. Right, sounds pretty smart when you put it like that.
Good on you John – thanks for exposing these fat cat neo liberalists – especially their leader Cullen.
Sadly we can’t trust Labour even with a pretty face as leader – at least with National – they let the workers know that they are about to kick them in the guts – and they do so with a smile/smirk on their faces.
Labour lets the workers believe that good times are coming for all – then we see reality.
YOU CAN BET THERE WILL BE NO CHANGES ANYTIME SOON TO BENEFIT THE WORKERS OR THE POOR THROUGH TAXATION.
Time for us all to join the local Labour Party branches and let them know what we really think.
Why are we not at all surprised: Labour is, after all, a business-as-usual political party.
They’ll keep doing it* until they can’t.
*promoting business-as-usual
Kia ora John – thanks for being vigilant on this. But I do want to speak in defence of Craig Elliffe, who chose to come from the corporate sector to academic and is a professor at the Auckland law faculty. He and Prof Michael Littlewood hosted a really interesting and broadbased conference on capital gains tax a couple of years ago that has been published as a book, which hopefully will inform the discussions on NZ tax policy and the working group in the way academic work should do.
Why do you abuse Labour constantly ? You even damn Jacinda’s face. You are low life.
You could if you wanted, spend a bit of time acting like grown ups. Change from being depressing little snotty nosed children.
Go back to your Capitalist friends. Do it now.
What?
Are you talking to yourself now?
Your context and argument completely eludes me I’m afraid.
I suspect that they will give very little or no consideration to a financial transactions tax. To me, this would be one of the simplest to implement, and yet one of the most effective to increase revenue.
It will be a farce if nothing solid is achieved and it’s all been a costly wasteful exercise.
If, however, this Working Groupdoes come up with some credible proposals, then the top-heavy stacking of pro-capitalist names will have been a master-stroke. It will have demolished any possibility that National denounces the Group as a “leftwing front”.
The question is; what will this Group come up with?
It had better be good, or this Coalition will be a one-term wonder.
The make-up is concerning at first glance, but what other profession save Jane’s could people be drawn from who’s profession leaves them as conversant with the issues. Sure they spend their time studying how to help their clients avoid tax; this means that they know what needs to be done to make it work more fairly for everyone. What they come up with will depend on their individual philosophies, and their integrity.
The IRD ‘s stance is that it is the duty of managers , esp. of corporations to pay the tax due by law, but not what is not due by law, and the system is designed to provide loopholes deliberately constructed to influence investment in some areas as is deemed desirable for society. So I don’t think they will necessarily come up with inequitable ideas. But I do think that an aspiring political party should come up with it’s own structure , run it past a panel of experts for viability rather than equity which is for the party to assert. Then put it before the voters pre election and implement it when (if) elected.
D J S
The saying is failing to plan is planning to fail. Things we ought to plan for in the future or will fail to plan for are.
1. Closing all of the tax loopholes is a solid start to tax reform.
2. With that the system is vastly simplified, and you can proceed to tax corporate and business at a more reliable legal measure (because god knows big business barely pays taxes. They’d probably die of heart failure if they had to pay the raw numbers).
3. Once you’re getting more money out of big business and you’ve eliminated deductions, take a look at the numbers and see what the middle and lower classes are paying, as a percentage of their income and compared to their median cost of living. See if you can decrease that.
4. Increase the personal taxes paid by the ultra rich as opposed to an estate tax.
5. Institute a UBI of approximately $6k per person
6. Flatten tax rates, eliminating the lowest tax brackets, with a minimum tax rate of 25-26%*, depending on how the math works out. Note: Due to the UBI, this is still a progressive tax system.
7. Have investment income be tracked in parallel brackets as earned. IE 25% for first $10k, 35% for next $50k – Earn $10k in wages and $10k in investments, you’re still only in the 25% bracket. Earn $20k in wages – 30% effective tax rate. $20k in investment income? 30% effective tax.
8. If I can’t get a UBI, first $10k or so is untaxed.
9. Eliminate deductions that are sold as being for the middle class, but instead benefit mostly the wealthy, such as the home mortgage deduction. Money for housing is in the BIG. If I can’t get a BIG, transform it into a set credit with a maximum instead.
10. Remove the maximum on Benefit taxes
11. Increase eligibility for kiwi saver substantially. Pay for it with an appropriate increase the contribution rate(This is creating a new funding source for venture capital/infrastructure).
12. Reduce the corporate income tax rate down to at least the global median while at the same time charging taxes for pollution, possibly including carbon dioxide
13$ 1% towards a ‘future fund’ – basically, restarting the Cullen fund.
What’s likely to happen is:
We get new forms to fill out that make automation of the tax system easier for the industry to retrain and the group are just facilitators for this.
I want to be optimistic about all this. But first of all right across the political spectrum globally the left is facing off against extreme right wing fascism. So friendly political conditions for torture. If we are to have radical change then we must begin planning for Robertsons jobless future now, and that planning would surely consider a UBI or some other way of redistributing surplus. And this is a big challenge that only the Left can solve, and that’s the challenge of controlling revolutionary change so it doesn’t brake out into extreme right wing fascism.
*gasp!* You’re being reasonable! (You often are…)
Do you suppose they’ll dig into the stealth taxes -excise and the like – and that universal evil labelled GST?
I like it that Bil Rosenberg’s on the list. He seems to have the knack of putting economics into plain English.
And I hope Michael Cullen’s outgrown his dogmatic phase. Ascerbic wit has its place, yet it’s lateral thinking we need more of on this job. Less orthodoxy and more provocation. We surely need that to break us free of this taxation quagmire.
I’d be more interested in seeing just how they manage to make it “revenue neutral” to get to $80-$82 billion. If they want funding for healthcare, housing, education and the rest, they run the risk of causing the same internal problems as before.
They can’t gut welfare/health or cut anything because of campaign promis… but I’m not sure that won’t get just as much flak over KidsCan, as a lot of electorates that went Red have quite a few people depending on the health system, while Blue electorates tend to be somewhat more wealthy and able to take up the slack.
I’m… not sure how Cullen can keep it neutral. Of course, that’s without playing funny games where they pretend something is “revenue neutral” when it isn’t. Not sure if they’d get that one passed in a technical sense in spite of those pointing out they’re lying or not. Or though Billy hasn’t done his credibility any favours with his $11bln hole.
It’s going to take awhile for the minimum wage rise to start showing up in the tax take. This will be in interesting fight… While pulling out a minimum wage rise that can stimulate the economy is probably easier than winning election17. Which will also weigh against the Labour/Māori caucus and give them a bit of a boost too.
As a practical political matter, there are lots of true believer “NO MOAR DEBT” types in the working group. I think they’ll likely clash with the we must do more types. So no borrowing and no new taxes really makes for a super brain twister. I mean this is one heck of a conundrum. And there is probably only one man for the job and that is Sir Michael Cullen.
Looks like they should have invited you Sam.
The focus should be on how to prevent untaxed profits of both multinational companies and local companies going offshore without paying any tax at all. It is a world wide problem concerning all administrations so it would get a sympathetic hearing from some quarters in all trading partners, but it would be anti-globalisation.
I agree the iniquity of GST Andrea. I think that income tax should be the only tax, the only reason to diversify taxes is to pretend to reduce taxation when you actually intend to increase it. If companies were all owned locally there would not be any need to tax them at all as no individual could access profits without paying personal income tax, but with so much business being done by companies registered outside NZ taxing them here is vital.
D J S
Well at least there is a group…
under National…nothing.
The results will speak for themselves on this one.
Well, it is good that John Minto points this out to us, as there has been no such analysis by the MSM.
It is a sight of NZ as it is today, a society where much is privatised or at least associated with private business and their interests.
It is hard to find ‘expert’ advice that has no ties to business interests, I noticed this during Auckland Council’s Proposed Unitary Plan hearings, how many experts were simply consultants who usually also worked for many businesses, who submitted to that plan.
Even many university and similar experts have had past or existing connections to business, and are therefore mindful of business interests. Business rules NZ Inc. there is no doubt about it, and people come second, despite of all nice sounding slogans.
And as there are so few truly independent or alternative experts, Labour and this government have appointed the ones they saw fit, most having business ties of sorts, and therefore having also a declared or not declared conflict of interest.
Even study institutions like Unitec here in Auckland are cooperating with big business when offering study courses, for instance in IT. See this, how they work with IBM:
http://www.unitec.ac.nz/career-and-study-options/computing-and-information-technology
That is the society we now have, after all those ‘reforms’ under Labour since 1984, and then later National from 1990/91 on. The state has got out of many areas of responsibility, has outsourced, contracted out and sold operations and its interests.
And the most shocking thing is, that most simply accept this as the ‘normal’ or put up with it, no matter what. People are in their majority also corrupt, not just the rich and powerful, as they make their own deals and keep their mouths shut, for job security and their personal financial and other interests.
I voted TOP.
wow, who would have though a tax working group with tax specialists in it.
Of the fucking humanity.
What the fuck are bankers there for. The biggest parasites locally and globally. They have been convicted by IRD on several occasions for massive evasion of taxes in NZ.
Rosenberg is the only one independent of finance industry ties. Just a token to be over ridden.
Where is the taxpaying community of Kiwis representation as they are the majority of NZ. Where are the representatives of NZ families.
Labour and NZ are under attack from the parasites and also from within Labour.
The crunch has started.
Perhaps it takes a thief to catch a thief.
It was suggested to the Minister for Finance that the working group on tax should include a number of ordinary citizens chosen by lot and therefore representing ordinary taxpayers. No response was received.
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