Envy still drives Labour’s tax and spend

June 26, 2014

Labour’s announcement on its financial plan shows it has learned nothing from the mistakes it made when it was last in government.

Labour’s tax and spend ‘plan’ released today is the Opposition’s usual approach to public finances, Finance Minister Bill English says.

“After nearly six years in Opposition, all Labour can come up with is a re-hash of its failed old recipe of taxing more and spending more,” Mr English says.

“No one will be surprised – or impressed – by that.

“Labour want to increase taxes so they can spend more without any focus on better results. They are out of touch with New Zealanders’ expectations that the measure of good government is better results, not more spending.

“Labour’s complex capital gains tax would be full of holes, slap a new tax on 2.3 million KiwiSavers and on every New Zealand farm and business without addressing the real issues around housing affordability.

“As for the proposed new top tax rate, it’s just the politics of envy. It wouldn’t actually raise much money, it would encourage those who could do so to shelter money in companies and it would ignore the fact that these taxpayers already pay 22 per cent of income tax – even though they are just 2 per cent of taxpayers.”

Labour still hasn’t learned that lower tax rates lead to higher tax takes and the reverse also applies.

Never before in Britain’s history has so much tax been drawn from so few high earners – and lower tax rates are the cause:

The biggest problem with the last government was its failure to realise what it was doing wrong. David Cameron, by contrast, often doesn’t seem to realise what his government is doing right. . .

It sometimes seems that even Conservatives are surprised by just how well conservatism works.

Tax cuts, especially, have been viewed with deep suspicion by those around Mr Cameron.  . . This was about tribalism, rather than economics, and it took some time for the Prime Minister to realise that tax cuts are often the surest route to recovery and stability.

But, then, the top rate of income tax was lowered from 50p to 45p in the pound, and the Liberal Democrats forced the Government to lift three million of the lowest earners out of income tax.

It has been politically difficult – Ed Miliband chastises Mr Cameron for his “tax cut for millionaires”. But something remarkable has happened: those millionaires are now paying more tax than ever. The best-paid “one per cent” are spoken of as if they all employ clever accountants to wriggle out of paying any tax. Yet figures show they now earn 13 per cent of all paid income, and provide 28 per cent of the income tax collected.

This is higher than at any point under the last government, and twice as high as under the Callaghan government (when the top rate of tax was 98 per cent). We are witnessing what John F Kennedy called the “paradoxical truth” that lower tax rates can mean higher tax revenues. When people are taxed less, they tend to earn (or declare) more. It has taken Britain into a golden era of milking the rich. . .

 Here it’s similar with the top 2% already paying 22% of the total income tax.

Labour’s planning to increase the tax rate on trusts to circumvent the wealthy channelling money into them to avoid higher taxes.

But it’s not just the wealthy who have trusts and those not so well off will have to pay the higher rates too.

Labour will be taking more money from everyone for KiwiSaver and reducing the return from those savings with their Capital Gains Tax too.

Their plan is the same old tax and spend, driven by envy that put New Zealand into recession before the Global Financial Crisis.


June 26 in history

June 26, 2014

363  Roman Emperor Julian was killed during the retreat from the Sassanid Empire. General Jovian was proclaimed Emperor by the troops on the battlefield.

1284  The legendary Pied Piper led 130 children out of Hamelin.

1409 Western Schism: the Roman Catholic church was led into a double schism as Petros Philargos was crowned Pope Alexander V after the Council of Pisa, joining Pope Gregory XII in Rome and Pope Benedict XII in Avignon.

1483  Richard III was crowned king of England.

1541  Francisco Pizarro was assassinated in Lima by the son of his former companion and later antagonist, Diego Almagro the younger.

1718  Tsarevich Alexei Petrovich of Russia, Peter the Great’s son, mysteriously died after being sentenced to death by his father for plotting against him.

1723  After a siege and bombardment by cannon, Baku surrendered to the Russians.

1817 Branwell Bronte, British painter and poet, was born (d. 1848).

1848 End of the June Days Uprising in Paris.

1857  The first investiture of the Victoria Cross in Hyde Park.

1866 George Herbert, 5th Earl of Carnarvon, English financier of Egyptian excavations, was born (d. 1923).

1870  Christmas was declared a federal holiday in the United States.

1892 Pearl S. Buck, American writer, Nobel laureate, was born (d. 1973).

1898 Willy Messerschmitt, German aircraft designer, was born (d. 1978).

1908 Salvador Allende, Former President of Chile (1970-1973), was born (d. 1973)

1909  Colonel Tom Parker, Elvis Presley’s manager, was born (d. 1997)

1909  The Science Museum in London became an independent entity.

1913 Maurice Wilkes, British computer scientist, was born.

1914 Laurie Lee, British writer, was born (d. 1997).

1917  The first U.S. troops arrived in France to fight alongside the allies in World War I.

1918  The Australian steamer Wimmera was sunk by a mine laid the year before by the German raider Wolf north of Cape Maria van Diemen.

1918  World War I, Western Front: Battle for Belleau Wood – Allied Forces under John J. Pershing and James Harbord defeated Imperial German Forces under Wilhelm, German Crown Prince.

1921 Violette Szabo, French WWII secret agent, was born (d. 1945).

1924 American occupying forces left the Dominican Republic.

1927 – The Cyclone roller coaster opened on Coney Island.

1934  President Franklin D. Roosevelt signed the Federal Credit Union Act, which establishes credit unions.

1936  Initial flight of the Focke-Wulf Fw 61, the first practical helicopter.

1940 Billy Davis, Jr., American singer (The 5th Dimension), was born.

1940 World War II: under the Molotov-Ribbentrop Pact, the Soviet Union presented an ultimatum to Romania requiring it to cede Bessarabia and the northern part of Bukovina.

1942  The first flight of the Grumman F6F Hellcat.

1943 Georgie Fame, British singer, was born.

1945  The United Nations Charter was signed in San Francisco.

1948 – William Shockley filed the original patent for the grown junction transistor, the first bipolar junction transistor.

1948 Shirley Jackson‘s short story The Lottery was published in The New Yorker magazine.

1952 The Pan-Malayan Labour Party was founded, as a union of statewise labour parties.

1959  The Saint Lawrence Seaway opened, opening North America’s Great Lakes to ocean-going ships.

1960 The former British Protectorate of British Somaliland gained its independence as Somaliland .

1960 – Madagascar gained its independence from France.

1963  John F. Kennedy spoke the famous words “Ich bin ein Berliner” on a visit to West Berlin.

1973  At Plesetsk Cosmodrome 9 people were killed in an explosion of a Cosmos 3-M rocket.

1974  The Universal Product Code was scanned for the first time to sell a package of Wrigley’s chewing gum at the Marsh Supermarket in Troy, Ohio.

1975  Indira Gandhi established emergency rule in India.

1975 – Two FBI agents and a member of the American Indian Movement were killed in a shootout on the Pine Ridge Indian Reservation in South Dakota.

1976  The CN Tower, the world’s tallest free-standing structure on land, was opened to general public.

1977 The Yorkshire Ripper killed 16 year old shop assistant Jayne MacDonald in Leeds, changing public perception of the killer as she is the first victim who was not a prostitute.

1978 – Air Canada Flight 189 to Toronto overran the runway and crashed into the Etobicoke Creek ravine. Two of 107 passengers on board died.

1991  Ten-Day War: the Yugoslav people’s army began the Ten-Day War in Slovenia.

1993 The United States launched a missile attack targeting Baghdad intelligence headquarters in retaliation for a thwarted assassination attempt against former President George H.W. Bush in April in Kuwait.

1994  Microsoft no longer supported MS-DOS and the development of FreeDOS began.

1995  Hamad bin Khalifa al-Thani deposed his father Khalifa bin Hamad al-Thani, as the Emir of Qatar, in a bloodless coup.

1996  Irish Journalist Veronica Guerin was shot in her car while in traffic in the outskirts of Dublin.

1997 – The U.S. Supreme Court ruled that the Communications Decency Act violated the First Amendment to the United States Constitution.

2003  The U.S. Supreme Court ruled in Lawrence v. Texas that gender-based sodomy laws were unconstitutional.

2008 The U.S. Supreme Court ruled in District of Columbia v. Heller that the Second Amendment to the United States Constitution protected an individual right, and that the District of Columbia handgun ban was unconstitutional.

2012 – The Waldo Canyon Fire descended into the Mountain Shadows neighbourhood in Colorado Springs burning 347 homes in a matter of hours and killing two people.

2013 – Riots in China’s Xinjiang region killed at least 36 people and injuring 21 others.

Sourced from NZ History Online & Wikipedia


%d bloggers like this: