NZ economy $270m poorer due to multinationals exporting earnings, think tank says
The economy missed out on hundreds of millions of dollars in taxes in the past year because of unequal international tax settings, according to a new report.
The global Tax Justice Network’s report said multinationals shifted about $2.5 billion earned in New Zealand overseas last year, and in doing so the country missed out on about $270 million in taxes.
The non-profit group argued the international tax system was unjust and allowed multinational concerns to make unfair profits.
The chairperson of Tax Justice Aotearoa, an affiliate of the network, Glenn Barclay, said multinational companies shifted their profits around the world to minimise their tax bills, thereby hoarding unfair profits.
“[In] US dollars $1557 million generated in NZ by multinational companies is shifted off to other countries,” he said.
“We lost $US167.6 million in tax revenue that could have been spent on the things we need such as education, health, and infrastructure, as well as responding to climate generated environmental disasters such as Cyclone Gabrielle.”
The report demonstrated the losses incurred by lower income countries were proportionately much greater than for higher income countries.
It called for an end to global tax abuse that deprives countries of tax revenue, saying greater transparency was needed on the activities and behaviour of multi-national companies and rich individuals who hid their money offshore in tax havens.
The report recommended a UN tax convention as a basis for an independent body to set standards and rules for global tax policy and law.
“Tax Justice Aotearoa supports these recommendations and calls on the New Zealand government to support the proposal for a UN tax convention, which is due to be voted on in December,” Barclay said.
“It is time for the government, whoever wins the election, to take a stand on international tax abuse.”
The price maker corporations use NZ like a monopoly rental and extract profits for themselves at our cost!
Our purposely under funded state doesn’t have the capacity or tools to actually challenge these corporate interests!
The obligation of the Government is to regulate Capitalism so that we the people benefit from the competitive dynamics of competition!
The disgusting right myth is that NZ is an over taxed, over regulated economy when that is total bullshit!
Max Rashbrooke highlighted the horror of NZs under regulated market…
The bad news is that, to investigate 200,000-300,000 terrible rentals, the Ministry of Business, Innovation and Employment (MBIE) has employed a frontline inspectorate numbering … 37. Each inspector will have to check somewhere between 5000 and 8000 rentals.
…there is only 37 inspectors of rental properties for 300 000 terrible rentals?
Similar poorly funded regulation is apparent in the 82 labour inspectorates who are supposed to police hundreds of thousands of migrant worker exploitations!
Time and time and time again in New Zealand we see an old boy matrix of vested interests who occupy market dominance and act like a monopoly, duopoly or oligopoly raking in vast wealth while leaving the local small and medium sized operators outside the cosy relationships!
Up and down NZ, small and medium enterprises are unable to compete because of the lack of basic regulation in the market!
We’ve seen it with the Supermarket duopoly, the medicinal cannabis oligopoly, the Gib Board monopoly – each time under regulated and poorly regulated capitalism continues to screw over us the consumers at a time of a cost of living crisis!
Frustration inside the drainage industry has reached boiling point recently with anti competitive practices and crony capitalism that would make your average South American Drug Cartels blush, so much so that the Commerce Commission is investigating.
We are not an over taxed, over regulated economy!
Our top tax rate is the 39th highest in the world behind all the Scandinavian countries plus Germany, the United Kingdom, Ireland, France and South Africa!
Australia’s top tax rate is 47cents!
Our GST rate doesn’t even get us into the top 50 and our corporate tax rate is 40th while Government spending against GDP ranks 56th!
And we are voted easiest to do business by the World Bank!
I’m not looking for socialism here folks, just basic garden variety regulated capitalism!
We can’t drain the swamp because the crocodiles have learnt to shoot machine guns at anyone who attempts it.
That’s why David Parker is such a threat to the establishment, why Chloe’s Wealth Tax is attacked and why the Māori Party’s new tax policy that would specifically target transnationals needs to be championed!
The wealthy are sinking millions into National and ACT to stop their interests from being taxed and the public service we deserve being properly funded!
This election is not about bilingual signs or alienating Trans nonsense or co-governance or get tough on crime cheerleading, this election is about taxiing the mega wealthy to combat the cost of living crisis.
Stop being manipulated by the wealthy into culture war grievances the woke help feed!
TAX. THE. RICH!!!!
Increasingly having independent opinion in a mainstream media environment which mostly echo one another has become more important than ever, so if you value having an independent voice – please donate here.
If you can’t contribute but want to help, please always feel free to share our blogs on social media
By abolishing all the tariff cuts and restoring import restrictions, this money could no longer be siphoned straight out of the country.
Import substitution would resume, meaning that local workers would receive the wages to produce the goods, and each step of production would be subject to local taxes, all the way down the supply chain. The wealth is retained locally, and the economy becomes more advanced as the infant industries grow.
It would be worthwhile to give tax breaks to large investors in domestic production. That is better than the production and head offices being domiciled abroad, where no local tax can be collected.
The transnationals or what I’ll call, the capitalist elites, have spent the past 40+ years purposely reversing or neutralizing regulation, spearheaded by the implementation of their neoliberal economic model that has seen (economic) inequality skyrocket and the tax burden transferred from these elitists and their corporate/financial vehicles on to us, the general public. In the US, the elitists and their business/financial vehicles made up close to 40% of the US tax burden in the 1960’s. Today, or not long before Trump and his gargantuan tax cuts to the aforementioned exclusive few, that rate/ tax burden was down to 11%. And of course, what happens in the US tends to flow through to the entire world. So, guess who has to make up for that shortfall – we do – via increasing indirect taxes and shrinking Govt services.
And weakening regulation and shifting the tax burden – all over the world – is just the tip of the iceberg of the influence and subsequent favorable policy, that this big-money crowd wields over politics and has extracted from the political world. This is the single biggest problem in the world today, in my book. How do we fix this problem, well, first thing that needs to be done is to realize that this problem is thee problem! Like any problem, unless we acknowledge the problem, then it never gets addressed. Get money and big money created vehicles, out of politics. We are supposed to be a democracy, the West is supposed to be the leaders of democracy, but the penetration of big money on the entire political world, renders democracy everywhere, nothing but an illusion. We don’t get a say, we do not get to vote on certain, global-wide decisions/outlooks/policies and so forth, the Ukraine war is a prime example of this. Notice how peace, the call for peace is non-existent all throughout the world. Contrast this to the 1960’s and the peace movements of that era that still get talked about today. Difference between then and now, the hold that big money had over the political system was near non-existent back then. Now, the only thing this war engenders within us is a concern over how much money we need to beef up our military by. Saying no to war is not an option available to us. I say that this is a prime example of the rottenness of the rotten political system we have today.
The problem is simple – the hold that big money has over the entire political system – is the single biggest problem in the world today. We need to acknowledge this.
Transnational corporations can do almost as they want.
They’ve got the threat of the TPPA’s mechanisms hanging hanging over the government like the Sword of Damocles, constantly tempering any action by the government on behalf of the people.
You can in large part thank your hero David Parker for that. It has cemented in the neo liberal paradigm for the next few decades or until some sort of revolution occurs.
Of course they get away with. All the anti CGT crowd would be raving f’ing hypocrites if they talked about the tax system letting this happen. They have lied their way through years of what supposedly should be taxed. The only reason they have owned multiple properties for years is the capital gain which effectively makes it a trade/business
Comments are closed.