Christopher Luxon, New Zealand Prime Minister 2023

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#3190772 5-Feb-2024 09:24

And the government is now opening the COVID-19 Inquiry gates just a little bit, so that the ~~crazies~~ partners can come in too:

“As committed to in both the ACT-National and NZ First-National coalition agreements, the public will be given the opportunity to have their say on a broadened terms of reference that addresses the handling of the response and many complex impacts of the COVID-19 response.

“The current terms of reference were decided by the same Government responsible for the COVID-19 response and they place significant limits on what the inquiry can consider. New Zealanders deserve a frank assessment of what occurred and how we can learn from it.

“The Government is seeking feedback on the inclusion of the following topics, as part of its commitment to expanding the scope of the inquiry:

Use of multiple lockdowns
Vaccine procurement and efficacy
The social and economic impacts on both regional and national levels
Whether the decisions made, and steps taken, were justified
The cost-effectiveness of the Government’s policies, and whether the rules set by the Government appropriately balanced COVID-19 elimination with other goals
The Government’s utilisation of partnerships with business and professional groups
The extent of disruption to New Zealanders’ health, education, and business as a result of the Government’s policies
If the Government’s response was consistent with the rule of law
How New Zealand’s pandemic preparedness compared to other countries
“The engagement will begin in February, and details about the opportunity to have your say on the terms of reference and how people can share their experiences of the pandemic will be announced soon by the Royal Commission.

“This is a forward-thinking piece of work. It is not simply about learning what went wrong, but working out what we need to do right in the future.

“This Government is ensuring all New Zealanders’ concerns are heard.”

I agree with the majority of the items - but this will open a can of worms that will need to be managed. Let's wait for the submissions.

sen8or

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#3190778 5-Feb-2024 09:40

Sometimes its best to let sleeping dogs lie.

Yes, we need to learn from the actions of the past to make sure our response is as good as it could be if (when) a future crisis hits, but there was so much vitriol, mis information and general unrest, peoples responses are going to be emotional, not rational

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#3190785 5-Feb-2024 09:54

https://www.1news.co.nz/2024/02/04/bilingual-road-signs-decision-coming-soon-transport-minister/

Let me guess, something else (relatively inexpensive this time) that's going to get ditched in order to give the rich more of those tax cuts they (somehow) need 🙄

GV27

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#3190837 5-Feb-2024 10:03

quickymart:

I'd rather have all the above as opposed to unnecessary tax cuts for the already rich.

I'd rather double Pharmac's budget than make a point of looking the other way while government organisations fail time and time again to get the costings for infrastructure projects right and keep coming back for more and more capital commitments from the taxpayer.

sen8or

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#3190846 5-Feb-2024 10:25

If "the more you earn, the more tax you should pay", is seen as a fair / progressive tax policy, why doesn't that translate backwards to receiving more benefit from a tax cut?

Someone on $48k now is paying about $ 7400 in tax under the existing tax brackets ($ 1470 under $ 14000 + $ 5950 up to $ 48k = $ 7420, an effective tax rate of about 15.5%) whereas someone on double that income is paying nearly 3x the level in tax ($ 7420to $48k, $6600 to $ 70k + $8580 to $96k = $22,600, an effective tax rate of about 23.5%).

A salary of $96k is a fairly decent salary, but not one that would put you in the upper echelons of "the rich". Could the ones on a $96k salary forgo a tax cut and leave more for lower income earners or have that cut applied to better areas, quite possibly, but I'd hazard a guess that if you are in Auckland with Auckland property prices, rents, living costs etc, perhaps not. On a NZ population basis, that would be a fairly generous assumption to make on a large scale.

Could the money be spent on other areas that would provide a wider benefit than a tax cut, absolutely (health, education, preventative justice measures etc etc etc), would National (with act/NZF) have won the election without a tax cut promise, quite likely, but tax cuts are only exaggerated with higher income earners because not only do they pay more tax in actual $, they pay a higher%.

freitasm

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#3190910 5-Feb-2024 10:48

I don't think anyone in their right mind thinks you are wrong regarding salaried people.

But I think the whole anti-tax cuts sentiment is that it mostly benefits people who are so rich. People who use all loopholes possible to pay less effective tax than those in the lower brackets, even though their earnings in a year are many times - thousands, even more than those more disadvantaged.

People who would not have problems feeding themselves and their families if they paid a little bit extra, unlike the most impacted who might end the month without enough to buy milk or bread for their kids to eat before going to school.

The same kids who do not get anything to eat at school despite their parents paying more taxes than before. Or not having the healthcare and dental care they need, despite their parents paying more taxes than before.

So yeah, keep talking about salaried people bands, ignoring the people who exploit the system, hoard the money and give back the minimum required to get people to work for them because a minimum increase in minimum pay would such a burden on their rich lives.

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#3190911 5-Feb-2024 10:48

freitasm:

And the government is now opening the COVID-19 Inquiry gates just a little bit, so that the crazies partners can come in too:

If it's anything like the UK enquiry it will become just a blame fest.

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sen8or

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#3190936 5-Feb-2024 11:43

freitasm:

I don't think anyone in their right mind thinks you are wrong regarding salaried people.

But I think the whole anti-tax cuts sentiment is that it mostly benefits people who are so rich. People who use all loopholes possible to pay less effective tax than those in the lower brackets, even though their earnings in a year are many times - thousands, even more than those more disadvantaged.

People who would not have problems feeding themselves and their families if they paid a little bit extra, unlike the most impacted who might end the month without enough to buy milk or bread for their kids to eat before going to school.

The same kids who do not get anything to eat at school despite their parents paying more taxes than before. Or not having the healthcare and dental care they need, despite their parents paying more taxes than before.

So yeah, keep talking about salaried people bands, ignoring the people who exploit the system, hoard the money and give back the minimum required to get people to work for them because a minimum increase in minimum pay would such a burden on their rich lives.

I try and keep things targeted in the middle, because no policy is going to capture the extreme ends of the scale and benefit lower income enough, or penalize the high end enough without collateral damage in the middle. Equally, its those on PAYE who are ultimately going to feel the benefit of a tax cut on a week to week basis. Companies, self employed, investors etc generally only pay their taxes on an annual basis (well, 3 times per year in instalments), so a tax cut isn't actually going to impact them in quite the same immediate way.

GV27

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#3190940 5-Feb-2024 11:50

Worth noting the 39% rate is persisting for now, so the super rich would only benefit to a much lower extent.

sen8or

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#3190943 5-Feb-2024 11:53

I think getting rid of the 39% would have been madness

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#3190953 5-Feb-2024 12:46

GV27:

Worth noting the 39% rate is persisting for now, so the super rich would only benefit to a much lower extent.

The super rich don't derive the bulk of their money from taxable income paid directly into their bank accounts. They make capital gains, which they pay no tax against when realised, or take loans against capital so remains unrealised. We need capital gains taxes, and we need to change the definition of a capital gain to recognise it as de facto realised when you use it to borrow against. If a bank can pretend that it is real, so can the tax man.

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GV27

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#3190956 5-Feb-2024 12:56

SaltyNZ:

We need capital gains taxes, and we need to change the definition of a capital gain to recognise it as de facto realised when you use it to borrow against. If a bank can pretend that it is real, so can the tax man.

Incidentally doing this with investment properties would have been a good interim step to wind back the ability of investors to leverage to the hilt; once you borrow against it, you are deemed to have realised any gain since purchase.

It would have avoided a lot of the other angst that comes with a CGT that has not yet addressed, such as the resulting double-dipping on Kiwisaver or why things like artworks seem to mysteriously be exempted every time someone commissions a report into what a CGT might look like.

However the reality is that if the state had expected to be reliant on a CGT for revenue for the last couple of years, it would either have had to raise other taxes or be left with a hole in the books. They work well assuming the price of everything goes up and up and up forever, but we probably shouldn't be planning on that happening with things like housing.

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#3190957 5-Feb-2024 12:57

sen8or:

I think getting rid of the 39% would have been madness

Generally yes, although I suspect we'll end up a higher 39% threshold and maybe a 35% rate in the fullness of time.

sen8or

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#3191007 5-Feb-2024 13:09

And if the bank gets it wrong and its not a capital gain, but a loss, will they get a tax refund if the taxman assumes the same?

If we make things too unattractive for investors, they'll simply invest in other places that are more advantageous for them, this also applies to areas that our super & kiwisaver funds rely on for returns. Moving away from realised gains to presumed gains could have far reaching unintended consequences (e.g who would bother revaluing an asset, resale of businesses manipulated to minimise capital gains etc).

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#3191018 5-Feb-2024 13:24

sen8or:

And if the bank gets it wrong and its not a capital gain, but a loss, will they get a tax refund if the taxman assumes the same?

Sure, why not?

If we make things too unattractive for investors, they'll simply invest in other places that are more advantageous for them, this also applies to areas that our super & kiwisaver funds rely on for returns. Moving away from realised gains to presumed gains could have far reaching unintended consequences (e.g who would bother revaluing an asset, resale of businesses manipulated to minimise capital gains etc).

We already have unintended consequences from our existing tax policy settings whereby a bunch of people leverage themselves to the hilt trading existing houses between them resulting in both reduced availability of houses for people who actually want to live in them as well as higher prices to buy and to rent. In addition to that, we know for a fact that the very richest pay less than half the effective tax of people like teachers and nurses.

What we have now doesn't work. We need to change.

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