Why Are Centre-Left Parties Chickening Out Over Changing Taxation?
What is it about parties on the centre-left in this country?
Why are they allowing the centre-right to define tax policy?
Why are they allowing the media to define tax policy?
The so-called ‘Overton Window’ needs to be moved towards major changes in taxation and unless the centre-left starts speaking up loudly, this will not happen.
It is distressing/annoying to see Labour being so scared of making changes to taxation that they have allowed their hands to be tied. If we compare Green Party taxation policy from 2023 to 2026, we can see the same chickening out.
I can understand why this is deemed to be necessary, as it is clear that if Labour, in particular, espoused a major rethink of taxation, the not so neutral private media would land on them like the proverbial tonne of bricks – unfortunately this also applies to the two state owned media organisations, TVNZ and RNZ, both of whom seem to want to show private media that they too can play the game.
It is a tragic state of affairs that the centre-left is so afraid of this reaction that they are forced to play a very defensive game and so allow the centre-right to define and dominate the taxation argument. One would think that a mature society could discuss taxation in a rational and non-emotive way. Clearly this is not the case.
The outcome is that we are allowing the more well off in our society, those who don’t need to worry about all the myriad costs that are landing on the rest of us, to dominate the taxation debate, all to minimise the amount they have to pay even though they wouldn’t really notice an increase in their taxation. And don’t tell me that they deserve their money because they work hard for it, that argument is a fallacy and easily dismantled. Being a rentier isn’t exactly stressful or demanding.
Labour’s reluctance to grasp the taxation nettle is understandable, just look at the lies being promulgated by Simeon Browne over the past week or so. Sticking their neck out over taxation is asking for a punch on the nose and given the media attitudes, could be fatal to election chances.
That’s a tragedy, as it is so clear that this country is suffering from a a lack of investment in so many areas, health being one. If we take the tax cuts offered by the last two National led governments into account, we can see that these have chopped a huge hole in the government’s finances.
I realise there is another argument, that governments spend first and then reclaim the money through taxation – check out economists Steve Keen and Richard J Murphy if you want to know more – and that the bogey of government deficits/surpluses gets in the way of sensible taxation policies. That’s another neoliberal myth that needs to be rejected.
However the clear fact is that the wealthy end of our society are not paying their fair share of taxation, leaving the burden on salary and wage earners and especially on the lower paid.
National are making a big claim about no new taxes. Disingenuous bastards. Should they end up back in power, they may not bring in new taxes, however they will raise money through bringing in more and more user pays charges, taxes by another name. User charges, though, impact the lower paid far more than the well off.
A $5 road toll is a substantial fee for a low wage worker, yet just just pocket money to the well off. Regardless of election results, we all should fight user charges no matter who is introducing them.
GST is another tax that impacts the poor far more than the well off and should be abolished, replaced by a graduated taxation system, especially one that targets unearned wealth.
Blogger Steven Cowan discusses taxation in this article:
THE ONLY OBSTACLE TO A WEALTH TAX IS POLITICAL COWARDICE
‘THE CASE for a wealth tax in New Zealand has never been clearer, and yet the political class has never been more determined to pretend otherwise. At a moment when inequality is accelerating, public services are buckling, and the richest New Zealanders are contributing proportionally less to the collective pot than at any time in modern history, the parties vying for power have closed ranks around the status quo. They offer minor tweaks, symbolic gestures, and rhetorical nods toward ‘fairness’ but none are prepared to confront the structural rot at the heart of our tax system. The result is a political landscape in which the most necessary reform of all — a meaningful wealth tax — is treated as unthinkable
Tax Justice Aotearoa’s report, published in March, lays out, with forensic clarity, the economic, and moral rationale for taxing wealth. The numbers are stark. IRD’s 2023 research found that the wealthiest 311 families pay an effective tax rate of just 9 percent, while ordinary New Zealanders — workers, beneficiaries, people whose income comes from labour rather than capital — pay around 20 percent. This is not a marginal imbalance. It is a structural injustice baked into the very architecture of our tax system, which leans heavily on income tax and GST while leaving vast pools of wealth essentially untouched. As Glenn Barclay of Tax Justice Aotearoa put it, ordinary people are contributing more to the collective pool even though the wealthiest benefit just as much, if not more, from the public goods that make society function.’.
Why should we allow this to continue? Why should ‘ordinary New Zealanders’ pay for the parasitic rich, who are happy to take but not to contribute?
‘And yet, faced with this reality, New Zealand’s political parties have responded with timidity bordering on negligence. National has taken the most brazen stance, proudly declaring that there will be no new taxes under any government it leads. This is not a commitment to fiscal discipline; it is a commitment to protecting the wealthy from contributing their fair share. The party knows full well that ‘no new taxes’ simply means higher charges elsewhere — user-pays models, levies, fees, and the quiet erosion of universal public services. It is austerity by another name.’
Anyone who votes for any of the centre-right parties is voting for this to continue, for user charges to increase and for continued underfunding of essential infrastructure. You’d better hope you don’t need to access the hospital system.
A reminder for you – back in the 1990s under the tender care of Jenny Shipley, National instituted a user pays hospital system where patients were required to pay up to $500 towards hospital care. I wouldn’t rule out them trying this trick again.
‘Labour, for its part, has retreated into the narrowest possible interpretation of tax reform. Rather than championing a wealth tax that could meaningfully address underfunding in health, education, housing, and social services, it offers a diluted capital gains tax that barely scratches the surface. Labour’s caution is not ideological; it is political. The party fears backlash from the wealthy, from business interests, and from a media ecosystem deeply intertwined with capital. In doing so, it abandons the very people who most need a fairer system.’
The Greens don’t escape either:
“Perhaps the most disappointing shift has come from the Green Party. Once the only parliamentary force willing to challenge the tax orthodoxy, the Greens have watered down their wealth tax proposal at precisely the moment public appetite for change is growing. Their previous plan targeted fortunes over $2 million — a modest threshold by international standards. Now the tax begins at $10 million, dramatically reducing both its reach and its revenue. Commentator Bryce Edwards has described the policy retreat as ‘puzzling.’ The Green’s have aligned themselves with Labour’s caution rather than the public’s demand for structural reform.’
Read the full article for the rest of Steven’s reflections. He lays the situation out very clearly.
If you want to know more about the state of taxation on the rich, this IRD report is illuminating.
High-wealth individuals research project
‘The report shows that when personal, company and trustee taxes are included, the median family in the high-wealth group paid 8.9% of their economic income in tax.
When GST is included, the median family in the high-wealth group still only pay 9.5% of their economic income in tax. For this group, GST paid is tiny, relative to their economic income compared with the other 90% of taxpayers.’
Since it is highly unlikely that high wealth individuals are reading this article, that means that all you people who are reading this are paying higher rates of taxes so that the rich can live the high life. Happy with that?
The indisputable fact is that the government is underfunded, that they can not invest in this country, and so all our institutions are deteriorating. A sensible fair taxation system is vital to turning this around, yet due to the timidity of Labour in particular, this is not on the table.
Above that, however, is the issue with the media dominating the discourse to such an extent that it may be electoral suicide for Labour to do anything more than they are doing.
Mind you, Labour campaigned in 1999 on increasing the top tax rate to 39% and they still won the election.
Given that opinion polls show that the majority support a wealth tax, why has 2026 Labour chickened out?
The time is now for a wealth tax, but none of our parliamentary parties are prepared to campaign for it. It is little more than the defense of a failed status quo.
THE CASE for a wealth tax in New Zealand has never been clearer, and yet the political class has never been more determined to pretend otherwise. At a moment when inequality is accelerating, public services are buckling, and the richest New Zealanders are contributing proportionally less to the collective pot than at any time in modern history, the parties vying for power have closed ranks around the status quo. They offer minor tweaks, symbolic gestures, and rhetorical nods toward ‘fairness’ but none are prepared to confront the structural rot at the heart of our tax system. The result is a political landscape in which the most necessary reform of all — a meaningful wealth tax — is treated as unthinkable.
https://nzagainstthecurrent.blogspot.com/2026/08/the-only-obstacle-to-wealth-tax-is.html
Food for thought Allan
Ten weeks till the election, and Labour is in full pre-election cringe mode. They’re so afraid of being seen to stand for something, let alone something that Rimmer might consider “left-wing”, that they’re ruling out policies in advance. Paying for our roads. Paying for local government. Restoring fees-free tertiary education. Shanking Netflix. Notably, they’ve ruled out all their potential coalition partners’ tax plans – the Greens’ wealth tax, TOP’s land tax, and Te Pāti Māori’s stamp duty on house speculators – which raises the question of how they expect to form a government while offering their coalition partners nothing. And meanwhile, while they’re doing all of this cringing and cowering from the word “tax”, it turns out that the public will happily support higher taxes for better public services:
A survey of 1600 people has found two-thirds of New Zealanders are willing to pay more tax for better healthcare – particularly when it comes to cancer.
The survey, funded by the Cancer Society and published as a nine-paper series in the New Zealand Medical Journal, also found consensus across voters for all major parties about the need for tougher regulation on tobacco and unhealthy foods, and more urgent action on skin cancer prevention, cancer screening and treatment.
A collaboration between University of Otago cancer researchers and the Cancer Society, called Te Rōpu Rangahau ō te Kāhui Matepukupuku, undertook the study.
This is not exactly a new finding. And it suggests a very obvious political slogan of “tax the rich to pay for the health system”. But Labour has so afraid of being accused of “taxing and spending” (as opposed to National spending without taxing) that they refuse to take the opportunity which is staring them in the face. They’re simply standing in front of an open door leading to government, refusing to take it, while whining about how they can’t get inside. And then they wonder why they’re stuck on 30%. I’d suggest that part of the reason is that and Labour is not giving people any reason to vote for them. More brutally, no-one likes a chickenshit. And as Marc Daalder points out, their “small target” strategy effectively leaves the entire political field free for other parties willing to make promises and take risks. Labour has only itself to blame if its cowardice results in it being overtaken by parties actually willing to offer something.
https://norightturn.blogspot.com/2026/08/whining-at-open-door.html
“governments spend first and then reclaim the money through taxation – check out economists Steve Keen and Richard J Murphy”
This is what Adrian Orr recommended to Adern and Robertson. Soak up the post covid liquidity by taxing the top end of town.The covid money was helicoptered into wage earners and flowed to the top and could have been recovered at the top. Every man woman and child received $10k. If their bank balance wasnt up $10k at the end of covid then that money had flowed up. But Grant and Jacinda refused to do what Orr recommended so instead the interest rates were cranked on home owners and huge bank super profits have been exported out of the country.
Recently saw a video of Mayor Brown and Chloe Swarbrick trying to out woke each other. Now the mayor wants to extend the war on cars to the person, implementing suveillance infrastructure and congestion taxes. Where’s the freedom?
“All he needed was a wheel in his hand and four on the road.” Jack Kerouc, On The Road.
The congestion levy being proposed by National and supported by Labour is another example of a tax that negatively impacts the poor more than the rich. I can’t believe Labour is supporting this, particularly when public transport is in as woeful state as it is, and petrol costs are already so high.
Labour is supporting a congestion tax which really is a tax on the poor but for the wealthy is just a convenience fee.
AT Planner: Why should bottom feeders get to work cheaply and conveniently when it makes my Tesla commute to my $250k job 4 minutes slower?
But why would the country expect Labour not to support this congestion tax BS. Afterall Labour is the govt that brought in the immorality of taxing food, ffs.
NO GST ON FOOD!
The top 10 percent pay more than the bottom 80 percent combined.
And the top 1 percent contribute more than the entire bottom half of taxpayers.
so they should as they have 60% of the economy in there bank which us real low paid workers paid a bigger % in tax on our minimum wage than they do on their million plus .Its about the % .I will be happy to be taxed under TPM rates even if I have to pay 480 k on the million I earn because I will still have more than the bottom feeders .I mean 100k a week after tax is what a bottom feeder has to work 5 years to clear .
That’s just not true. Any of it.
Unless you’re talking about income, but this discussion is about wealth tax.
The top people in terms of wealth pay less tax on their economic income than those on minimum wage do.
This is actually obscene.
The math explains that they pay more tax because they receive much more income under what is a limited progressive income tax and various tax free ways to accumulate wealth. Why don’t you come up with numbers describing how much more expensive life is for the bottom 80% because of the extreme wealth accumulated at the top of you want to do something useful?
Economically Labour are capitalist/neoliberal, and socially they are social democratic.
Marx would describe their social policies as applying a band aid to a gaping wound.
They are only left in the sense they are left of National and ACT. They are never going to change the economic system to something that reduces inequality.
I have no idea why people bother with them. Just a sentimental legacy I guess.
Spend a bit of time over on MSN, read the comments sections, and you’ll soon figure out why labour is scared on taxation. These people make a lot of noise, and are facilitated by the billionaire owned lugen press. Not just in New Zealand but pretty much over the Western world.
As soon as you mention wealth tax there is pretty much absolute hysteria among the Conservative commentariat. And trying to find out about successful wealth taxes isn’t that easy. Out of the dozen countries that have introduced them, eight have given them up for one reason or another. Four still remain, but all are subject to loud criticism.
Personally I think we are better off taxing those huge companies that make large amounts of money in New Zealand and yet contribute absolutely Bugger all to our tax base. While making excess profits of course.
Yes slap a 30% exit tax on every dollar the corporates export as a tax dodge pretending they are paying licence fees or some other fictitious cost .
Morena
Labour are centre, definitely haven’t been left for a very long time, just because some lefty’s are standing to try and push them to the left doesn’t mean it will ever happen Taxes – TPM and the Greens these are the parties to support then if they go to Labour with ONE COMBINED BOTTOM LINE WHICH IS THE TAXES. Hipkins won’t have a leg to stand on, he is lack lustre and pathetic.
Because they aren’t remotely left-wing. Thank God for the Maori Party.
I have read what’s on the Labour Party website and the word inequality does not seem to feature. This in the light of David Parker and the IRDs own study exposing tax inequality.
If the media are going to paint you with this brush whatever you say, you may as well man-up and open the debate. You have all the evidence you need. What Labour lack are the balls to drive it!
Maybe they have a plan to get money out of the ultra rich another way ? Are they scared of Donald invading Aotearoa on the back of wealth tax ?
Allan, check out Te Pati Maori tax plan released today – seems more like what you are seeking.
I saw that. Unfortunately they won’t have the leverage to get Labour to adopt any of it. Greens & Te Pati Maori may have enough clout to get some tax changes through
Labour are National Lite They will just sit on the fence wringing their hands IMHO, and do very little as it is their turn to F*ck Around with the NZ Economy ???
Well ACT have enough clout to ruin the whole social fabric of NZ even though they are a minion party with less elected MPs than TPM .The only reason TPM IS IGNORED IS BECAUSE THEY ARE BROWN ,even though their policy is for every tax payer in NZ .
..because they’re more neoliberal than left-wing…
Maybe they are certainly not the party that I grew up supporting