Labour’s puny move on tax misses the super-rich altogether

41
1240

The government has passed legislation to increase the top income tax rate to 39% on income over $180,000

It’s the biggest tax move planned by Labour for the next three years and yet its impact will be puny.

Labour has been telling its working class supporters its new top tax rate will have an impact on reducing inequality while reassuring the middle class that it will only apply to the top 2 percent of income earners.

Both statements are misleading.

Firstly the biggest impact in inequality I have seen quantifies the impact on inequality at 0.2% on the GINI measure of inequality. Forget it.

TDB Recommends NewzEngine.com

Secondly the tax is on incomes so it will impact the big salaries of executives but it will miss the super-rich altogether.

As Inland Revenue pointed out several years back – half the highest net wealth New Zealanders (those 200 or so on the NBR’s rich list) declared incomes of less than $70,000 – where the top tax rate used to kick in. I’d be willing to bet that less than 10% of these super-rich bludgers will end up paying the new top tax rate.

Labour, by ruling out a capital gains tax and a wealth tax, has boxed itself into a corner and at the same time has boxed all of us into policies which will increase inequality and poverty.

It’s a small political party, afraid of its own shadow.

41 COMMENTS

  1. Should we be surprised that the Adern government is worse than useless?

    I am not. Worse than useless -actively destructive and failing to address anything important- has been the benchmark for decades, whichever party has been in power,

  2. Old Pinko Minto calls the most productive members of society “super-rich bludgers”. If the most productive people in society are not rewarded in proportion to their productivity, then you don’t have a society. You have the eternal misery of Socialism.

    • It’s a myth that unearned wealth from asset inflation and speculation and selling off companies and looting for profit equates to productivity the opposite applies these bludgers who the government hasn’t the guts to bring to heel are a predatory curse on any society. They in fact leech on society its vigour and optimism. Part of the neoliberal garbage bag of tricks to fool people.

    • Really the super rich are the most productive of society.
      The super rich made their dosh on the backs of the workers, you don’t get super rich by yourself.
      I expect Minto will hold on to the great title you have given him – Minto who cares deeply about the poor and dispossessed unlike Ardern the hand wringer.

      • Yes, some of them have employees but so does Apple, Google and Microsoft. They risk their capital undertaking useful enterprise and their employees and shareholders benefit from their efforts in ways that they otherwise would not be able to achieve on their own.

        • Capitalism is simply a loot-and-pollute system, based on non-existent capital -all ‘capital’ there days is created out of thin air via loans, which have to be serviced by yet more looting and polluting.

          When people like you talk of productivity, they are referring to how quickly finite fossil fuel energy resources are converted into waste, and how quickly fossil fuels energy resources are used to covert other resources into waste.

          Far from being our saviours, business people are the source of all our woes, as they progressively chew through the last of the fossil fuel reserves to create wastes that are poisoning the world and engulfing it.

          Borrowing from Orwell, Ignorance is Strength for the moment.

          But as the world progresses through this period of declining energy availability and increasing breakdown of the environment ignorance will be exposed as the profound weakness it always has been.

          Yes, there have been many short-term superficial benefits acquired by raiding the carbonaceous deposits nature sequestered hundreds of of millions of years ago, but those short-term benefits are far outweighed by the diabolical living conditions most people will face in the near future, as the whole caboodle of industrialism comes to an abrupt end as a consequence of the very aspects industrialism is predicated on -using money created out of thin air to extract fossil fuels and burn them.

          It is, of course, children alive today who are going to pay the most dearly for all the insanity that characterise current economic arrangements and current living arrangements.

          Gail Tverberg reiterates what many of us have known for a long time: that abandoning the hunter-gatherer lifestyle and adopting settle agriculture based on the growing of grains was a fatal mistake, and that adopting the use of fossil fuels as an energy source was an even more fatal mistake.

          https://ourfiniteworld.com/2020/12/02/humans-left-sustainability-behind-as-hunter-gatherers/#more-45875

          The key to any kind of future for the human species is dependent on rapid decoupling from fossil fuels.

          And with people like you -ignorant and greedy- in the majority, the chance of voluntary decoupling from fossil fuels is zero.

          Therefore, it will occur involuntarily, with catastrophic consequences for most people.

          The only good news is that population overshoot in NZ is less than in other parts of the world (NZ being the last major land mass to be discovered and settle by humans), and being relatively close to the equator, can support humans without fossil fuels.

          On the other hand, the destruction already accomplished by industrial humans may have triggered runaway overheating that will take the Earth to several degrees Celsius above the current overheated state.

          • I feel sad that you have suck a bleak world view but the good news is that it is based on misinformation. Your multiple mentions of “people like you” reminds me of a Scott Adams quote: “If your opinion depends on reliably knowing another person’s inner thoughts, you might be experiencing loserthink.” – Scott Adams, “Loserthink” (2019), p30. We are not “poisoning the world”. This planet is a closed system. Nothing goes in (except for the odd meteorite) or out (except a bit of gas) so you can’t add or subtract anything, only move things around or change things from one state to another. Undersea volcanoes have been spewing out hydrogen sulphide for millions of years and the oceans and the species of prawns that thrive in the boiling water that results are doing fine. I would be glad if we replaced 19th century fossil fuels (including plastic by-products) with a cheaper and more sustainable alternative but unless we embrace thorium breeder reactors (that consume their own waste) or build more hydro there is currently nothing that is as efficient or scalable as fossil fuel. I don’t see the current generation of couch potato gamers becoming hunters or gatherers. LOLs 🙂

  3. John…
    That’s interesting about half the really wealthy declaring less than $70 000 income. But there is the whole issue. While wealth can be moved around the world to avoid paying tax anywhere, taxing inflation (CGT) or net wealth will no more force equitable contribution from those in control of their affairs than does income tax. The burden would fall on small to medium domestic operations which provide employment for others.
    The only way to force the properly wealthy to pay their share is to control the flow of wealth at the national border. That means breaking international trade agreements left right and centre. It won’t happen until and unless it collapses internationally.
    D J S

    • ” That’s interesting about half the really wealthy declaring less than $70 000 income. But there is the whole issue. ” That’s because the bludgers have hidden their ill gotten gains in tax haxens, trusts and other tricks using tax lawyers depriving their home society of legitimate tribute by tax to maintain that society.
      ” taxing inflation (CGT) or net wealth will no more force equitable contribution from those in control of their affairs than does income tax. ” this is nonsense! The government acts for all the people or should!! These taxes on speculation gains are then redistributed to society’s actual workers and ordinary citizens.
      ” The burden would fall on small to medium domestic operations which provide employment for others. ” More nonsense we’re not suggesting taxing small businesses more Minto didn’t say this!
      ” The only way to force the properly wealthy to pay their share is to control the flow of wealth at the national border. That means breaking international trade agreements left right and centre. It won’t happen until and unless it collapses internationally. ”
      Also nonsense! 🙁 LOL LOL

    • If the truly rich spirit their money offshore and hide it in the Bahamas, or invest it in dodgy Da Vincis, sure the state misses out on tax, but apart from that, does it really matter? If, however, the truly rich or even the merely-very-comfortable-thanks sink their money into real estate, then not only does the state miss out on tax, but that act of buying into real estate drives up the cost of real estate for everyone else in New Zealand and contributes to unaffordable houses, unaffordable rents, and homelessness.
      Tax land. All land. Forget other wealth, that’s just a distraction. Modern Monetary Theory argues that the Government doesn’t need tax to spend on services and infrastructure: it can print as much money as it needs to do that. The purpose of taxation is to control demand, and nudge spending from one area of the economy to another.
      Make houses homes to live in, just one each, by making them unattractive as collectors’ items.
      Tax land.

      • Yes yes yes one home each, if you want to invest use the share market ,any more than one home without being taxed is pure greed and everyone knows this.

        • Not every one wants to own a home with the hassles that come with it . People are more mobile with work and life style . This means it suits some to rent so someone needs to own property for them to rent . In Europe many rent all their life but they are protected much better than here and houses prices and rents are stable .
          The investment in property as rentals started in ernest in the 90s when us baby boomers were told that the country could not afford the pension and we needed to look after ourselves as the state would not .This has since proved false but as bank interest is now so small many who would sell are put off . I do not own rentals now as I found it too stressful but can understand why people do .

  4. RICH PEOPLE SCREWED TO PAY MORE THROUGH COURAGEOUS NZ LABOUR GOVT TAX BOMBSHELL: YEAH NAH.

    Sharp and accurate John. More micro policy neokindness PR spin with no substantive change .

    Labour needs to keep the 420,000 ex National voters to win a third term .Labour will not risk a run back to National by enacting transformational tax reform which attacks these peoples wealth or sense of privilege .

    Ending child poverty , affordable housing , benefit reform and improving mental health will simply have a mass migration back to National , especially if the EX National voters have to pay for it .
    Over 70 NGO’s have called for urgent Govt Action on poverty with no response .Its appalling .

    We should call Jacinda ” Tinkerbelle ” as all she does is tinker .All she can do is tinker .

    Apparently Santa voted Labour in 2020 and has now joined the Labour team in an official capacity .

    He was last seen in Westfield Mall handing out ,shiny America’s cup toys and prechecked party pills to hungry kids wearing a light blue Santa suit .I think they just wanted a feed .
    Sadly , it just didn’t resonate like the old red Santa .
    Will the real Santa please stand up .
    Merry Christmas .

  5. I think the tax is even worse because the target for the tax, is workers aka doctors and honest taxpayers.

    They should be targeting the cash economy, money laundering and a stamp duty on all forms of property including commercial property.

    They should also put in a tiny ‘micro’ financial tax on all transactions through electronic means.

  6. Ardern the great populist prime minister sitting on her hands when she is not wringing them and angsting about the poor.

  7. “….the highest net wealth New Zealanders (those 200 or so on the NBR’s rich list)….”

    And there are only 200 on the rich list? And you’re expecting tax from 200 people to fill the gaps in the government’s tax revenue? Good luck with that…..

    “Labour, by ruling out a capital gains tax and a wealth tax….”

    I used to favour a CGT, too. Until I read this:

    https://www.stuff.co.nz/business/opinion-analysis/114628351/an-inconvenient-truth-about-tax-in-new-zealand

    As to a wealth tax: manifestly, the number of wealthy in NZ is vanishingly small. Taxing them more won’t make up for the shortfall; in fact, it sounds like nothing so much as jealousy and revenge.

    This has become a low wage economy. Why on earth would we think that there are wealthy people here in any numbers? The ebbing tide drags all boats down, doesn’t it?

  8. RICH PEOPLE SCREWED TO PAY MORE THROUGH COURAGEOUS NZ LABOUR GOVT TAX REFORM: YEAH NAH.

    Sharp and accurate John. More micro policy neokindness PR spin with no substantive change .

    Labour needs to keep the 420,000 ex National voters to win a third term .Labour will not risk a run back to National by enacting transformational tax reform which attacks these peoples wealth or sense of privilege .

    Ending child poverty , affordable housing , benefit reform and improving mental health will simply have a mass migration back to National , especially if the EX National voters have to pay for it .
    Over 70 NGO’s have called for urgent Govt Action on poverty with no response .Its appalling .

    We should call Jacinda ” Tinkerbelle ” as all she does is tinker .All she can do is tinker if she wants a third term.

    Apparently Santa voted Labour in 2020 and has now joined the Labour team in an official capacity .

    He was last seen in Westfield Mall handing out ,shiny America’s cup toys and prechecked party pills to hungry kids wearing a light blue Santa suit .I think they just wanted a feed .
    Sadly , it just didn’t resonate like the old red Santa .
    Will the real Santa please stand up .
    Merry Christmas .

  9. @ JM
    “Labour’s puny move on tax misses the super-rich altogether”
    That’s because the super rich own Labour like they own National, the MSM, our Reserve Bank and our primary industries. They own the land we stand on and the oceans that surround us and the fishes in it.
    We’re all locked in a logical fallacy ‘Black Mirror’ like mind-vault where they allow us to be free as we hope we are while in reality we’re being imprisioned and forced to work for them tirelessly and our reward is a cheap car and a house that’s nothing more than a debt tomb.
    We’re not free. We’re not voting to stear our country toward an ever better outcome for us every three years. That’s all bullshit. In a nutshell, we’re currently fucked.
    We need a rebellion. We need a leader who can say ” Right! Fuck this for a joke. From now on the fucking gubbimint does what WE tell it. NOT the other way around” which is the current norm.

  10. Should we just line up the profiteer exploiters against the wall, and even today their are plenty, even here.
    Humanity, our we are Kiwi!s, look at us as the world looks on, some ridicule our population size, and life saved by our leading understanding how to manage this virus, not control or hope fend, as taxation is the same in a social caring society, like a covid injection, a injection on our humanity, or capitalist, taxation is our deposit on our humanity.Should we start by, home or money transacted,THE LATTER, every twenty four hours of our breathing, breathing money 24 hours at a tax rate of 0%2, HOW THAT WEALTH.

  11. The house John key lived in while PM earned more money ( about $1 Million per year ) than Sir KKK got paid for being prime minister of NZ…..

    Keys house was ‘worth more’ to society and NZ ,, according to the amount earned ,,, than multiple heart surgeons or two or more neurosurgeons ,,,

    In fucked up NZ.. ,Real estate agency owners and agents are ‘worth’ far far more than our health professionals and specialists.

    Do you see the big hole in your right-wing ‘free market’ bullshit fredonas ?? ,,, the market does not reward what is good for society.

    The cost of unregulated right wing speculation and exploitation is our housing failure ,,, which we share with all our 5 eyes Anglo chums.,,, political choices that honest workers are ‘not worth’ decent housing at affordable pricing..

    Greed and its cousin Corruption ,,, would affect us just like the Aussies ,,,, ” Financial crime is a “global catastrophe”, ,,,,,,with some $2 trillion a year being laundered,

    “https://www.michaelwest.com.au/money-laundering-bill-finally-back-in-parliament-despite-fight-by-law-council-property-lobby/ “Behind that $2 trillion in black money are real world consequences: internationally the laundering facilitates corruption, child exploitation, environmental crime and terrorism; while locally, money laundering is undermining Australian democracy. It is also contributing to rampant rising house prices.

    . To this day, in Australia a young family buying a house at auction could be bidding, unknowingly, against a buyer’s agent for a company controlled by a corrupt overseas politician or a drug syndicate. These people are much less price sensitive than an Aussie family. Yet the accountants, lawyers and real estate agents who structured those deals are able to turn a blind eye,” Lynch said.”

    ******************************************************************

    More on the secrecy jurisdictions / tax havens that the rich use ….. Wars, drug cartels, black market weapons trading , people trafficking , deforestation and every other major type of environmental destruction and exploitation ,,, are all reliant or helped along on the greased wheels of our 5 Anglo eyes banking and financial system.

    Labours failure to roll back the Lord Ashcroft* inspired regulations and law changes that kiddy killer Key snuck into NZ law, with the help of his public relations and image maker organizations , the group of right wing censors known as the NZ media ,,,

    Labours failure to extract us from the Secrecy Spiders club,,, is Labour giving middle finger to climate change and the environment.,, enabling profiteering and money laundering from deforestation speaks louder than hollow words .

    Some of the largest criminals and environment destroyers on the earth are the second largest land owners in NZ.

    Emergency Govt declarations about the climate are empty spin , ,,,, when our Actions as a country have us laundering plundered money for some of the most ruthless, criminal, forest destroying thugs and thieves on the planet. https://www.sarawakreport.org/2019/10/no-profits-from-malaysia-and-papua-new-guinea-but-vast-assets-in-nz/

    other examples of the planet destroying system key plugged us into … and Labour is yet to pull the plug on.

    “Most of the foreign money funding ocean plunder and the felling of the Amazon forest comes through tax havens,”

    “Over-Fishing and Deforestation – Why Isn’t It Stopped? Tax Havens”

    “The fishing ships are a network of mostly unregulated fishing vessels operating under “flags of convenience”. The deforestation of the Amazon is also funded by companies with one thing in common – billions of dollars used in countries that are tax havens.”

    The history of the forestry sector since the country’s independence has been a woeful tale of corruption, greed, profligacy, patronage, tax avoidance, maladministration, incompetence, and environmental destruction’ https://www.sarawakreport.org/2020/01/predator-logging-company-thrown-out-of-solomon-islands-is-owned-by-sons-of-sarawak-mp-expose/

    *********************************************

    *Lord Ashcroft*““the Royal Bank of Canada, which – despite its name – had extensive operations around the Caribbean.
    In 1987, the branch was bought by Michael Ashcroft,”

    “In 1990, in part after advice from Ashcroft, Belize passed laws creating an offshore financial centre” (offshore financial centre = tax haven )

    ““perhaps the founder of the Crimestoppers charity ought to have been a little more curious about why customers were using bearer shares, mail holding accounts, nominee directors and all the other accoutrements of offshore tax crime.””

    “A bank with close links to Lord Ashcroft will be accused in a British courtroom of keeping $10m destined for social housing in a poor central American country,” https://www.theguardian.com/politics/2011/jun/16/ashcroft-bank-belize-privy-council-row

    PPP ashcroft “Under the terms of the agreement, the islanders pay about $22m a year for the next 25 years – almost $600m – for the $124m invested by a Canadian health company and its financial backers who awarded the $65m hospitals construction contract to Johnston.”

    “Ashcroft told the London Stock Exchange in 1999 that he had sold Johnston, and has said he has “had no economic beneficial or legal interest” in the company since.

    But a series of faxes to Ashcroft from the chief executive of Johnston, Allan Forrest, seen by the Observer, show that he was regularly updated on the company’s pitch to win contracts to build two new hospitals and an airport in the islands. The faxes, from 2004 and 2005, …..” https://www.theguardian.com/politics/2012/mar/31/lord-ashcroft-link-caribbean-firm

    Labour believes in PPPs ,,, as shown by their signing of the TPPA.

    • Without watching your right wing rubbish Andrew ,,, I can tell you that the double Irish with a dutch sandwich ,,,that john key was gutting the usa tax base with ,,, benefited the rich at the expense of everyone else.

      Despite usa corporations profits growing hugely ,,, by creatively / falsely becoming Irish corporations , with the dutch twist ,,,, they skipped out on paying their fair share of usa tax ,,,or wherever they are trading and making profits.

      ie” ExxonMobil Australia has racked up total income of $42.3 billion over the past five years of available Tax Office data. Yet it paid not one cent in income tax in this country.

      This means that every worker on the minimum wage in Australia, and plenty who earn less, pays more income tax than this US oil juggernaut. ” ” https://www.michaelwest.com.au/australias-top-40-tax-dodgers-2020-fossil-fuels-dominate-once-more/

      https://www.michaelwest.com.au/top-40-tax-dodgers-2019/

      “Our world is not short of wealth. The size of the global economy has almost quintupled over the past 30 years. In 2017, its value reached nearly $78 trillion.

      Yet, the gap between rich and poor gets wider, with a massive increase in wealth at the top, while the total wealth owned by those at the bottom is falling. Since 2015, the richest 1% have more wealth than the rest of the world combined.

      Such extreme economic inequality is being fueled by an epidemic of tax evasion and avoidance that has reached an unprecedented scale. While millions across the world live in poverty, rich individuals and companies, exploiting the secrecy provided by tax havens, are continuing to dodge their taxes, depriving the poorest countries from being able to provide vital services.”

      https://www.oxfam.org/en/inequality-and-poverty-hidden-costs-tax-dodging

    • Without wasting time on Andrews links ,,, a )British Govt crocodile tears / smears ,,, a scandal In which a large humanitarian organization sacked two of its workers for using a brothel / prostitutes ,,,

      b) The fact the zionist hero harvey weinstein alone or with his brother , raped more women ,,, than all the combined sexual allegations, for all of oxfams staff and for all of oxfams history.,,, has nothing to do,just like Andrews post ,,, with oxfams reports on tax havens, poverty and inequality.

      The crocodile outrage is possibly revenge for contributing to the knowledge that England bankers and the British spiders web of secrecy jurisdictions,,,has made London a world center for criminal money and tax avoidance.

      Also Oxfam was drawing attention to the man made disaster in Yemen,,, where a Saudi coalition which includes the british and usa ,,, is Killing children by starvation or dropping bombs on them ,,, executing them at the rate of 1 dead child every 10 minutes ,,,

      “The scenes in al-Sabeen women and children’s hospital in Sanaa were apocalyptic. Almost every bed and every ward was occupied by a malnourished child. Their tiny skeletons visible through their skin. It will haunt me forever” https://www.independent.co.uk/voices/yemen-war-child-starvation-coronavirus-b1761708.html

      ““Countries should stop cashing in on this appalling humanitarian crisis and instead put people’s lives above arms manufacturers’ profit.”

      “USAID continues to withhold its aid to northern Yemen, where 80% of Yemenis live – leaving millions without vital medical care, clean water and food,” https://www.oxfamamerica.org/press/donors-slash-funding-yemen-half-25-cents-day-person-need/
      *************************************************
      …. and of course if there is conflict and war going on in the middle east ,,, zionists and their blue star butchers aprons will be in on the killing

      https://www.oxfam.org/en/press-releases/g20-arms-exports-saudi-arabia-worth-three-times-aid-yemen-2015-oxfam

      https://www.middleeastmonitor.com/20190827-maariv-israel-involved-in-yemeni-conflict-to-serve-saudi-lover/

      Finally some abuse Andrew supports ,,,, the zionist Lebensraum and its resulting abuse on ethnically unclean children
      Palestinian Girl Cries as Israelis Bulldoze Her Home https://youtu.be/kD_hA61KMiI

      Hundreds Of Palestinian Children Made Homeless In Jerusalem – Home Demolitions https://youtu.be/n2py7Twu0fY

  12. “Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience”

    CS Lewis

    • Dear CS. Ulster Tory logo-gaggler. Reminds me a bit of Trotter with his rounded plausible arguments at every occasion. Sure they have sincere views but like good lawyers they can argue anything.

Comments are closed.