Easy Fix for Avalanche of Wage Claims – Social Credit Party
The government could head off the avalanche of wage claims that is coming at them like a runaway freight train by scrapping GST and replacing it with a transactions tax.
The wage claims, from nurses, teachers, police, IRD and MBIE staff, and others, have the potential to wreck the economy by kick starting inflation and pushing up interest rates.
Private sector employers will likewise be under pressure to raise wages, increasing their costs substantially.
The cumulative effect will be to drive up interest rates, causing a major correction in house prices and hundreds of mortgage defaults.
Replacing GST with a transactions tax at less than a quarter of one percent (a quarter of a cent in every hundred dollars) on all withdrawals from bank accounts would give workers across the board a substantial increase in purchasing power greater than they would get from wage rises.
It would generate roughly the same in tax revenue as GST, but with a substantial amount coming from the speculative sector of the economy.
That raft of financial transactions such as credit default swaps, debt securities, convertible and exchangeable bonds, currency trading, derivatives etc, currently avoid the GST net.
The recent introduction of GST to on-line purchases is complicated and messy and will produce minimal tax revenue, whereas transactions tax is simple and would immediately put Kiwi retailers on an even footing with all overseas sellers.
Additionally businesses would be relieved of the burden of accounting for GST, filing returns, and audits.
It will be very simple for the banking system to implement FTT, and very difficult for anyone to avoid payment.
Banks would deduct the tax automatically in the same way they already withdraw their own account fees and Resident Withholding Tax, and remit it straight to the IRD.
The removal of GST would contribute to a reduction in child poverty by putting more money in the hands of lower paid New Zealanders who currently pay tax far out of proportion to their incomes.
It would be fitting that Labour, the party that first introduced GST and unleashed the neo-liberal economic experiment on the country were the ones that finally scrapped it
Agree and I am not a supporter of social credit
In my submission to the tax working group I said we must have a financial transactions tax and we must do away with GST which makes the poor poorer.
“Replacing GST with a transactions tax at less than a quarter of one percent (a quarter of a cent in every hundred dollars) on all withdrawals from bank accounts would give workers across the board a substantial increase in purchasing power greater than they would get from wage rises.”
A quarter of 1% is 25 cents in $100 isn’t it? 1% of $100 is one dollar surely.
Better clarify which it is that’s suggested… 1/4% or 1/4 of a dollar in $100.
It is an appealing idea and it is worth looking into, but the kind of transaction that is being targeted to produce the amount of revenue
“That raft of financial transactions such as credit default swaps, debt securities, convertible and exchangeable bonds, currency trading, derivatives etc, ” and other financial speculation is often made up of high speed transactions of large amounts of money making a very small percentage on each transaction. Small enough that though 1/4 of a cent in $100 might not be much of a disincentive to making the transaction (though it would probably stop many) 25c in $100 dollars probably would . This would be a good thing in itself as these transactions are totally parasitic on the real economy , but the scheme might not raise nearly as much revenue as hoped.
Having said that. A transaction tax that was sufficient to rub such speculation out and still raise enough to replace GST would be a great idea and much more equitable . But it might have to be at 2 % or more I supspect.
D J S
The parasites who make skim of wealth from us all with manipulation of money and assets are politically powerful and will resist this move which is hostile to their continued vampire activity, around the heart of capitalism.
Social credit has suffered under comprehensive attack from the parasites using their MSM, political patsies and public ignorance.
The basis of social credit is sound and it simply moved the authority to create money from private to state hands.
Their in nothing bad about that in fact it is so simple and common sense that you have to be seriously mixed up with private parasitic interests or accepting of deluded constructs of elite paternal power and the fear that accompanied all of that holding you in servitude to it.
Yes tax the parasites and their operations that take wealth from us.
Just a first step to renouncing their reign of terror we live under.