Looming Economic Carnage vs the Great NZ Tax Cut Scam
When I set MANA up with Matt McCarten, Hone Harawira, John Minto, Sue Bradford and the incredible Annette Sykes, there was an understanding that at the core of Left wing politics was a need to use the State to materially better everyone.
At the centre of that philosophical core was an understanding that the very tax system itself needed to be reset by taking the burden off the working poor and placing out upon the wealthy.
MANA argued for a Financial Transaction Tax that would be a base rate on all automated bank transactions, it would raise enough tax to bring GST down to 10% while allowing the first $20 000 to be tax free. The extra revenue would allow for a mass State Housing rebuild plus free public transport plus more money for education and health.
The total tax take from workers would lower while forcing the Banks, Corporates and Speculators to finally pay for their greed.
This is why the Tax debate every fucking election is such a shallow and hollow joke. Labour says blah blah blah and National scream tax cut. They are both fighting over an ever diminishing pie!
It’s the Great NZ Tax Cut Scam that never actually fixes the problem!
We need a radical means to place the yoke of taxation onto those who are causing the most economic damage and greed – the Banks, the Corporates and Speculators!
The true political division in a Capitalist Democracy is not the colour of your skin or gender identity or genital tribalism, it’s between the 1% richest, their 9% enablers and the 90% rest of us!
Labour must think big on funding universal provision of services to survive the economic downturn and the new post-Covid reality in a climate warming world!
To fund these big services we need a new tax system. A Financial Transaction Tax penalises those who are the greediest while funding the services that benefit everyone.
-Free Public Transport: Rather than welfare increases that the cruel and insidious MSD clawback, put money back into the pockets of the poorest with free public transport, while reducing climate pollution AND making roads more free for those who need to use them. Free Public Transport would make voters care.
-Free Dental Services: Our lack of free Dental is a disgraceful outcome of free market neoliberalism over public health.
-Free Breakfast and lunches in all schools: Again, rather than welfare increases that the cruel and insidious MSD clawback, put money back into the pockets of the poorest with free Breakfasts and Lunches at school. With inflation and mortgage rates soaring even the children of the middle classes will benefit.
-Legalise Cannabis: FFS, it generates half a billion in revenue and justice system savings, just do it for Christ’s sakes you gutless wonders!
-30 000 State House Build: Rather than simply trying to fund flawed models of a rigged property market built for speculators, do mass State Housing builds for only State House tenants and owner occupiers with rent to own options. Build these on Golf Courses we seize back from Auckland and Wellington using the Public Works Act.
-4 day working week in all public services: Build a post growth movement by adopting it in the State sector first. Employ more state servants.
-Basic Pharmaceutical Industry: The continued post Covid world of geopolitical threats demands a level of self sufficiency we are no where close to.
-Tidal Energy Production: Towards our 100% renewable energy target.
-Universal Free Internet: Available through all Churches, Marae, Libraries.
-First $20 000 Tax Free: Most people earn barely $40 000, making the first $20 000 tax free would benefit the poorest first and most.
-Vice Tax on all Gambling, Tobacco & Booze: A special super tax on top of the total tax paid for products that are a blight upon society. Why should the Gambling Booze Vape Barons peddle their harmful products with the barest of responsibility?
-Sugar Tax: The Big Sugar Drug Dealers have been allowed to sell their highly addictive drugs directly to market with no penalty for too long. Time too pay punks.
-Remove GST from fresh fruit and vegetables: Make healthier choices cheaper, works best with a sugar tax.
-30% Stake-hold in Supermarket Duopoly: The broken market is creating a million dollars additional profit each day to the Duopoly. Fuck them. A new supermarket chain will reduce cost and voters need to see that in an inflation explosion.
A Financial Transaction Tax, Sugar Tax and a taxed Cannabis Market could fund new services, old services PLUS take the tax take off the poorest and put it on the richest.
It’s time to be radical.
Why?
Because the economy is about to get hammered and the old systems won’t work any longer.
Finance Minister Grant Robertson admits tax-free zone on low income would help with cost of living
Finance Minister Grant Robertson admits that a tax-free zone on low income – like Australia has – would help with the rising cost of living.
Covid-19:Traffic lights live to illuminate another day, but the economy is overtaking the virus
ANALYSIS: The same day that Prime Minister Jacinda Ardern announced the end of vaccine certificates, scanning QR codes and some vaccine mandates, and then permitted unlimited-size outdoor events with no face mask rules, ASB published a small but consequential note forecasting that household costs could increase by $150 per week this year.
That’s $7800 in increased outgoings over the course of the year. It is a mixture of general inflation and increased interest rates – which will likely be jacked up to fight that growing inflation.
With weekly household costs tipped to rise $150 due to inflation, Finance Minister Grant Robertson has signalled a further 2.5 percent rise in the cost of living due to the war in Ukraine.
Why foreign investors are feeling jittery about China
State media has not tried to hide the fact that billions of dollars in global investors’ funds have drained away from China in recent weeks.
They have attributed the outflows–US$11.5 billion since the start of March and counting – to volatility in global markets, a hawkish US Federal Reserve and the impact of Russia’s invasion of Ukraine on global supply chains. One government publication has downplayed the seriousness of the situation and speculated that foreign money will soon come pouring back in.
The sooner we start seeing it as the 90% vs the 10%, the sooner we can get actual change.
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
Since NZ seems so committed to make NZ the leader of the stupid in the Thatcher Global Economy with most of our company profits now taken offshore, it makes the most sense for a financial services tax.
They also seem to be too scared to tax business in NZ. They pay less tax and get more subsidies and workers seem to pay more tax and have more targeted taxes.
Company tax rates have been reduced to 28% but top tax income rates have increased to 39%.
The richest in the world don’t seem to pay company tax and they don’t even seem to have to pay wages either as there is always government suckers in the world, who will take taxes from the poor and middle class to subsidies the super rich global billionaire ventures especially their wage bill.
NZ took it to a new level when the government (as well as the offshore wealthy) paid the small businesses often with fake people or drug front trafficking businesses to stay in business during Covid. You know the person that somehow needs 5 cleaning or restaurant business companies and pay for their franchises in cash.
In today’s global economy a financial transaction tax is fair if they want to stem extreme wealth and extreme poverty with the middle class declining.
This approach has failed many times before. Churchill said it best in one of his speeches…
“We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle”
Ah yes… how the conservatives love the “pull yourself up by your own bootstraps” argument. Completely vacuous of course.
What’s the counter factual then? If just increasing tax works why didn’t those incredibly high taxation rates in the 60’s and 70’s work?
I dunno, high taxation seems to work in Germany and every Scandanavian country.
But just to satisfy my curiosity, I had a quick look at Personal taxation by country and found that the countries with the lowest tax rates in the world were either third world, warzones, endemically corrupt, run as feudal theocracies, or just out right tax havens laundering money for the worst of mankind.
I also recall that in the Sixties in this country there was massive infastructure projects underway, and that NZ had one of the highest standards of living in the world. The inflation that occurred in the Seventies was Planet wide, and hurt every nation on the face of the planet.
Perhaps you would like to counter argue how the lowering of tax rates has improved every ones lives since the Eighties? Perhaps the downward slide in Living standards, Education, Incarceration, Health and all other aspects of functioning societies, is just a coincidence, a mere aberration if you will, and that soon as long as enough people suffer, we will all live in a capitalist utopia where no one starves, every one can afford basic necessities, is housed, there is upward mobility and no one is exploited by their employers.
They did in the U.S in the 1950’s ,tax rates of 80% plus=their most prosperous times…ever.
That’s a straw man phalacy cause they never do.
Labours legacy to people from it’s uselessness is going to be a National government.
And yet Nationals perennial tax cut crap is way past it’s used by date. This past two years and the need to be John Keys hermit kingdom is exactly because systemic underfunding has occurred constantly in the public health system.
Yes Christopher Luxon, you’ve got plenty, you’ve got bullet proof private health cover, YOU don’t give a shit because the world is about YOU.
It exactly like the right wing mayoral aspirants back in the day buying their jobs with rate freezes to the point where our basic sanitation services are now broken.
Voter’s need to see past Nationals blind vision of the future. Nothing I’m seeing from them is at all inspiring. Save shit, different bucket!
Trouble is the alternatives are awful!
Here here.
The Alliance was keen on a transaction tax. I had a good look into the idea back then and it would be very hard to assess what such a tax would earn.
John Kea would have a good idea cause he was a prime operator in that arena (casino). The fact is that these speculative transactions on currencies and securities transact huge sums of money very rapidly for very small % profit that don’t always make a profit. Even a tiny tax on each transaction would kill the profit on most of them. This would stop much of the speculation which is an entirely parasitic enterprise any way so that would be a good thing in itself, but to expect a lot of tax revenue from it I think would be a mistake.
D J S
DJS the greens campaigned on it in 2014 a .0.1% ftt tax just on outwards overseas transaction would bring in around $365 million a month from figures the greens had at the time.
I would vote for all of that. Especially the sugar tax. Why not add junk food into that equation too.
2.5-5.0% sugar tax should cover that.
To add @Anker, yep, why stop at sugar? ‘We are what we eat’. Remember that phrase from back in the day. Not that most took a damn bit of notice, or do now. But to be fair in the face of agressive and deceptive advertising can we blame ourselves. Its still all corporate bullshit dressed up as convenience and tapping into every human emotion you can think of. And now green washing added to the mix for a bit more flavour.
Sugar especially has a dark past. Along with the shelf-loads of so-called processed foods … well, we all know don’t we. Doesn’t ‘the science’ now tell us what we should be eating less of (and more of). The last few years have shown us – well, a good many of us – how to respect the certainty of science but when it comes to unheathy, low nututrional food its all given lip service. In the real world, commerce and the myth of personal choice trumps science every time. Type 2 diabetes, obesity, a host of inflamatory diseases, and more could all be put to the sword by taxing those foods that contribute most. But why stop there? Provide further incentives by reducing gst on what really matters. In our dreams perhaps! Too dracanonian. Smacks of unwanted intervention, a curtailment on one’s freedom of choice, not to mention upsetting the fuck out of food corporates and undermining the livlihoods of numerous small-time players. But think of the truck loads of money that could be saved on health care.
Nah. Consigned to the too hard basket.
Cynically accurate.
Shift the burden to landed wealth, which is taxed extremely lightly in NZ as compared, even, to so right-wing a state as Texas. In Austin, the Texas state capital, the annual property tax is $2.25 per $100 of property value, equating to annual rates of $22,500 on a million dollar property. The median house price in Austin is US $470,000 even though the city has a population of 2.3 million overall, more than Auckland, strong immigration, not much in the way of housing policy and is located in a region far more economically dynamic than New Zealand. The whole history of NZ politics over the last 100+ years has been the battle between those who wish to tax land vs those who wish to tax wages, and at the moment the latter are 99% successful even under the workers’ party.
So tell me which party has that policy on its manifesto and I’ll give them my two votes…
And don’t say Greens…
Jacinda is the cuckoo Nat who has simply been a fill in to make it look like we have a democracy. No Labourite would have said they would never introduce a CGT. She is just the Medvedev between Key 1 and Key 2 (Luxon)
National’s good old “tax cuts” to get votes is why I just can’t vote for them ever – they’re just as useless (and ultimately destructive) as Keynesian money printing that “the Left” promotes. Tax cuts isn’t going to solve the disastrous economy that Key and now Jacinda has put the country in. Only truly significant (near revolutionary) changes in how we have been doing things (i.e. the current policies were always unsustainable) is going to make any difference. We need out of the box thinking now, but there is no mainstream party that risks bringing that. So it’s going to happen the hard way (be it economic collapse, poverty, desperation, starvation, civil war etc). People really are fucking dumb.
“The true political division in a Capitalist Democracy is not the colour of your skin or gender identity or genital tribalism, it’s between the 1% richest, their 9% enablers and the 90% rest of us!”
“It’s time to be radical … Because the economy is about to get hammered and the old systems won’t work any longer.”
BINGO
Most of even my most woke friends are now talking rent, grocery and fuel prices more than protecting hypothetical individuals from even inadvertent misuse of pronouns. It’s going to get much worse than most people imagine. The Ukraine invasion will take a massive part of global energy, food and fertiliser offline this year. But the global financial system was already in a supper bubble ready to burst that will dwarf the GFC and China’s property ponzi scheme is collapsing and spilling out into the wider economy.
Whatever happens post-covid, the new normal will not look like old normal.
DJS the greens campaigned on it in 2014 a .0.1% ftt tax just on outwards overseas transaction would bring in around $365 million a month from figures the greens had at the time. If we had a 0.1% ftt tax on all purchase transactions and none of the GST rebate crap as a transaction moves along the supply chain gst could be ditched.
So Geoff, 365m is 0.1% of 365 billion per month or 4.38 trillion per year? Have I got my zeros right?
This bares out the relationship between genuine transactions and speculative trading at warp speed. But this is profit made by trading huge sums at the rate of several trades per minute by an individual trader and several per second in all. The profit on each trade does not need to be as much as 0.1% and is often not. So a tax of even that 1% would make most of those trades unprofitable and kill the speculation incentive. This would as I said be a good thing in itself but the profit (tax ) would never materialise. The trade would stop instead.
D J S
Yes off shore transfer would stop maybe. My suggestion to the Greens was to place the ftt tax on ALL TRANSACTIONS and replace Gst. After all everything has to be paid for over the counter or down the supply chain. From memory the Greens figure for the ftt tax was 0.001 or 0.01 % not 0.1% typing error in my original post.
National members probably liked doing Shakespeare when they were at College, particularly that bit about ‘the pound of flesh’. Putting on a performance of The Merchant of Venice would be elevated drama and very appropriate for now. The story is as modern as the morning’s sun. https://en.wikipedia.org/wiki/The_Merchant_of_Venice
National have have looked around and seen how poor people often are fat and thought, that’s such a waste of food, it is unhealthy and we’ll put them on a diet. Unfortunately being poor and the food that you grab for your 15 minute mealtime tends to be weight-inducing. Lean whippets off to their PR and legal jobs can afford meat and just not any meat it could be ribeye steak, or they can be so concerned about doing right in the environmental world that they give up meat altogether and require special food for their diet. (Note: we may get short of wheat, bread will get dearer, and apparently wheat has been the crop that enabled humankind to thrive.)
Well that’s a novel reply. Cant say that yours appear novel when I’ve read them. Up your game for something new Mick. Your reply is hardly pragmatic/
Cool stuff. Some suggestions:
Just get rid of GST on essentials, e.g. food, kids clothing, books etc. Otherwise keep the rate fixed and simple to implement.
Means tested, banded income tax is expensive to administer and subject to evasion by the rich and abuse by the bureaucracy. Just have a fixed rate on every penny, BUT also have non means tested universal income/benefit to essentially created a tax free band and a graduated real income tax rate without having to create a huge bureaucracy. You can probably get rid of the pointless minimum wage that just re-inflates the whole economy back to where it was before. UB allows people to refuse underpaying jobs if they choose to.
I think a transaction tax will be difficult/expensive to implement, hit those that can’t avoid it and will be avoided by those that can, i.e. the rich. What we really need is some sort of corporate tax that can’t be avoided because it is a function of wealth extraction by the rich, e.g. if there’s something left over after avoiding corporation tax to pay a dividend then tax that. etc.
Finally I’d use the government’s low cost of borrowing to provide normal people with low interest very long term fixed interest mortgages on their homes (not investments) through Kiwi bank and/or a rejuvenated post office system. Like they use to do before allowing the banks to tax that process. Introduce CGT on homes after the second property (to let boomers keep their retirement income and keep their vote). Oh and don’t put it on family farms like labour suggested (how to piss off half the country and never win a vote – which of course was deliberate to kill the whole CGT conversation).
Oh and of course you need to stop taking 10-20% (compounded) off everyone’s wages each year (and giving it to the rich) through inflation AKA/creating money. Getting rid of this alone would create a fairer society. It’s just legalised theft by the ruling classes.
With Today’s computing and almost all transactions electronic and ftt tax would be easy peasy .
After all the wealthy have to put the money into an account somewhere. The only reason an ftt tax was not introduced was the banks in the 1980s did not have the means to process it etc.
In today’s world that excuse doesn’t hold water. The costs of introducing it would be minimal and a damn sight less paperwork for business’s.
I could be wrong but I think a transaction tax will turn out to be regressive and hit the poor worse than the rich. ‘Doing business’ costs tend to get passed on to the common people. If you tax profit extraction it’s harder to pass on because it is post costs (that can be offset against profit and reduce tax).
Don’t just write about! Get back involved – these are brilliant policies. Why aren’t you and the other notable lefties interested in TOP Martyn? This must be the closest thing we have to Mana. As I read through the TOP website I thought where is John Minto? Why isn’t he here alongside these policies?
Sigh. We already have a substantial tax on sugar.
It’s a whopping 15%%%%%%%.
The problem is that someone got the unwise idea of slapping a 15% tax on HEALTHY foods as well, making the sugar tax invisible. The crime is that basic healthy foods that our children need to grow healthy teeth and bones and bodies and brains …are ALSO being taxed 15%. That is stupid and cruel. It is NOT the way to invest in a healthy future for AO/ NZ!!