My head hurts. So, so many numbers. I was staring at National's Tax Cut Calculator, the fields began to blur, and pretty soon I was comparing the tax cut I'd get as a single parent with three dependent children and what I'd get as a Level 11 Elven Ranger.
It really is getting ridiculous: the student loan calculator, the Working for Families calculator, National's tax cut calculator – so many calculators are required just to figure out what we're getting bribed with.
That's been my biggest disappointment with National's tax cut – despite all their talk about smaller government, reducing bureaucracy and cutting government waste, they've gone and made the tax system even more complicated, and loaded all the goodies on as tax rebates.
But before I rant further, one excellent bit of National's tax policy that I'm afraid will be drowned out in the deafening din: Dropping the secondary tax rate from a ridiculous 33% down to 19%. Fantastic. People work two jobs because they're poor, or because their first job pays peanuts, so it makes very little sense to tax them more for working hard (and not necessarily getting rich doing it). Moreover, it's a recognition of the casualisation of work, etc. I hope that, should Labour win, that they look into this, too.
Anyway, the line from Brash that really stumped me:
“During the interim period while the family tax is being developed, a 20% abatement rate will be applied on top of our 19% tax rate out to $50,000. This will mean that even with income support abating, lower income earners will face an effective marginal tax rate no higher than the top rate of personal income tax of 39% (19% plus 20%).”
No, don't bother trying to work it out - you'll waste more time than that tax abatement is actually worth.
That's not a completely flippant remark. We're in an election where our choice of bribes are a) an income-adjusted tax-relief/income-supplement package tied to the number of kids you have, versus b) an expansion of existing tax brackets (along with the addition of a new one) and a swath of tax rebates.
I think I might just work for the goddamn money, thanks.
Then there's the process of actually getting it. I applied for an accommodation supplement under WFF two months ago (worth $30-40/week, I expect), and I'll get to see a case manager later this week (I have no idea why I need to talk to them, or what we'll talk about, but The Bureaucracy demands it), and then my application will be processed and considered.
This is the kind of stuff that gives traction to National's “the government is wasting money on pen-pushers” message and to their shaming of Labour for making people grovel to MSD to get their own money back. But what does National do? Offer to take the money away from MSD's grubby hands and give it to IRD's grubby hands. Instead of applying for benefits like a peasant, you get to apply for tax rebates, like a big businessman.
As the Libertarianz say, “it's enough to make you want to vote Libertarianz”.
Incidentally, I gave my candidate vote to the Libertarianz last election – they were the only ones who offered a universal allowance. It was a remarkably simple concept – instead of the current welfare system, you just give a sum equivalent the dole to every adult, regardless of income, so that nobody has an income lower than that, and you completely remove the problem of marginal tax rates caused by benefits being taken away. That, and you can shave the welfare infrastructure down to the bone, which is a gloriously satisfying concept. And you're not giving rich people more money, because the extra will be funded from their taxes, anyway. It's not nearly as crazy as it sounds...
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Anyway, I'm sure there are some of you out there who are more mercenary about this, and for you, the choice can be really simple – punch up the appropriate numbers on the various websites and let the calculator decide your vote. After all, that's what a good rational economic agent would do.
If you want to get more reductionistic, don't even bother with being a rational economic agent – just be a blip in a demographic. Do you have a student loan, dependent children, or a low-income? Vote Labour. Are you rich, single, or childless? Vote National.
What? You care about the state of the economy and the nation beyond your own short-term financial gain? You're in the wrong election, buddy.
But then again, I guess I am, too. Watch this space for some geniune economic wonk later in the week. In the meantime, chew on Jordan Carter's numbers.