OnPoint by Keith Ng

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OnPoint: From the floor of the Tax Working Group

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  • Jeremy Andrew,

    $1.65 billion?
    I can get kiwis parity with the Aussies for a third of that!
    4 million NZers X $99 Jetstar one way to Sydney. Bingo, done.
    :-)

    Hamiltron - City of the F… • Since Nov 2006 • 900 posts Report Reply

  • Jeremy Andrew,

    Oops, double post. Stupid Ipod.

    Hamiltron - City of the F… • Since Nov 2006 • 900 posts Report Reply

  • Paul Campbell,

    Sigh - you have to think about economic reality - if you';re going to fly everyone to Oz all the flights will be returning empty - they're going charge you $198 for one way tickets .... plus someone has to pay for that last flight back to turn out the lights ...

    Dunedin • Since Nov 2006 • 2622 posts Report Reply

  • Kyle Matthews,

    I'd hope if you front up to jetstar and say "can I have 4 million tickets please?" they're gonna give you a bulk discount.

    If not, Mike Pero will arrange it for us I hear.

    Since Nov 2006 • 6243 posts Report Reply

  • Craig Ranapia,

    So, anything about a tax system that seems designed to encourage a culture of avoidance. You know, large corporations and (whisper this) nice middle class people can structure their financial affairs to avoid tax, while poor people can't? (The only way you can avoid GST is to go starve to death in a cave.)

    Or would that really be politically too hot to handle?

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Hilary Stace,

    Is that what's happening on the ground floor of Rutherford House at the moment? It's overrun by men in suits. I'm about to run a seminar on research on Grandparenting in NZ Today but a group has taken over my lecture theatre. Will just go and kick them out.

    Wgtn • Since Jun 2008 • 3218 posts Report Reply

  • Andre,

    @hillarystace Does Rutherford house still have tens of millions of dollars of taxpayer-funded artwork on the walls or did Electricorp take them when they left? That electricity privatisation has really worked...

    New Zealand • Since May 2009 • 368 posts Report Reply

  • Hilary Stace,

    The Electricorp art is long gone. There did used to be some wonderful NZ art on the 12th floor in the early days of Rutherford House becoming part of the university but that seems to have gone now. But there is one of my favourite of all time artworks in the foyer downstairs - that huge McCahon I AM which was bought by someone prescient at the university - probably quite cheaply - in the early 1970s. Also some other photographs etc from Victoria's art collection.

    Wgtn • Since Jun 2008 • 3218 posts Report Reply

  • Hilary Stace,

    I wonder if the tax men considered those grandparents parenting their grandchildren, or the various other financial burdens grandparents have? The tax group didn't seem terrifically representative of the diversity of NZ's population.

    Wgtn • Since Jun 2008 • 3218 posts Report Reply

  • Don Christie,

    So, anything about a tax system that seems designed to encourage a culture of avoidance.

    Does it? Really?

    Anecdotally I am sure we all know of avoidance schemes. Because the DomPost and NZ Herald told us.

    The question should be about reality not ones gut feel. My anecdotal observation is that in NZ avoidance and evasion is remarkably low, certainly when compared to other countries such as Spain, France and Delaware.

    But if you have some real evidence put it in front of us.

    Wellington • Since Nov 2006 • 1645 posts Report Reply

  • Rachel Prosser,

    Just clicked on the link to Gareth Morgan's new book on the sidebar.

    It looks interesting, and the end-of-life questions are well worth asking, as are "treat at all costs" vs" "quality of life" and "quality of death" issues. I'm looking forward to reading it.

    One thing jumped out at me in the media release though - to contrast 2 year old Porirua toddlers (unvaccinated) - why refer to a "90 year old Remuera Spinster" getting a bypass.

    Would she somehow be more deserving if she was a "Remuera Grandmother"? I'm not sure what stereotyping point he's making here and how her marital status is relevant. Maybe the example in the book would make more sense of it.

    Christchurch • Since Mar 2008 • 228 posts Report Reply

  • Andre Alessi,

    I don't have any philosophical objection to the idea of a flat tax that kicks in after a certain threshold (although for obvious reasons I'd prefer a progressive tax regime that responded to changes in the CPI.) The tax threshold in particular is a really interesting idea, and one I'd like to see more, because my central assumption about income is that everyone needs a certain amount of money to live, but beyond that it's all fair game for taxation.

    Morgan's other suggestions: dropping the Unemployment Benefit, the DPB, the Sickness Benefit (!) and so on are just loopy, but about what I'd expect from someone who thinks people in those situations deserve everything they get (or don't get, rather.)

    Devonport, New Zealand • Since Nov 2006 • 864 posts Report Reply

  • Ben Gracewood,

    The most interesting thing about Gareth Morgan's idea is how it highlights the complete lack of Capital (gains or otherwise) tax in The Don's proposal.

    I guess he (Brash) is a bit blinkered by the size of his own portfolio?

    Orkland • Since Nov 2006 • 168 posts Report Reply

  • George Darroch,

    Morgan's other suggestions: dropping the Unemployment Benefit, the DPB, the Sickness Benefit (!) and so on are just loopy, but about what I'd expect from someone who thinks people in those situations deserve everything they get (or don't get, rather.)

    What are you talking about? Sick people and those don't need money. If there is demand, the market will provide!

    I'm reminded about my favourite joke about Don Brash and a parachute right now.

    WLG • Since Nov 2006 • 2264 posts Report Reply

  • Andre Alessi,

    I'm reminded about my favourite joke about Don Brash and a parachute right now.

    What, something along the lines of "Benefits are the parachute at the bottom of the cliff?"

    Devonport, New Zealand • Since Nov 2006 • 864 posts Report Reply

  • Craig Ranapia,

    Does it? Really?

    Yes. Really. Back on planet Earth, beneficiaries can't set up tax shelters or family trusts to reduce their tax bill; corporates and nice middle class people can. And if there's a way to avoid paying GST (which is arguably a regressive consumption tax) on your groceries, I'd really love to know how. Not talking out my arse here, Don, but I don't pretend to have all the answers either.

    But, as I said, I guess it's politically unpalatable to even ask whether an unfair burden is being put on people who don't have the means (or access to expertise) to pass it on. Perhaps we'd all be a bit better off if various banks who've been in the news recently put as much time and effort into paying their tax bills as they have constructing, and trying to defend, astoundingly shonky shelters they shouldn't have been able to construct in the first place.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • George Darroch,

    I'm reminded about my favourite joke about Don Brash and a parachute right now.

    Basically, everybody is jumping off a burning plane, and the last parachute can't be found. Brash sits there calmly to the amazement of others. "Don't worry", he says, "economic assumptions show that if there's enough demand, someone will create one".

    The number of bare assumptions in the report just issued is astounding. I happily accept that not everything can be measured, and doing new things means making assumptions. But to take that many liberties? I'm tempted to throw an assumed can-opener at him.

    WLG • Since Nov 2006 • 2264 posts Report Reply

  • Kumara Republic,

    Basically, everybody is jumping off a burning plane, and the last parachute can't be found. Brash sits there calmly to the amazement of others. "Don't worry", he says, "economic assumptions show that if there's enough demand, someone will create one".

    I'm also reminded of a Tom Scott cartoon that came out just after AirNZ was bailed out by the Beehive. It went something to the effect of this:

    (Close up of bow-tied evacuee being hoisted to safety.)
    Evacuee: A long rant that I've long since forgotten, but self-explanatorily, it ends with, "Long live Roger Douglas!"

    (Cut to long shot of AirNZ plane sinking in water, & rescue helicopter marked NZ Govt or something like that.)
    Rescue Pilot: "Do you want to be rescued or don't you?"
    Evacuee: "Sorry, old habits die hard..."

    The southernmost capital … • Since Nov 2006 • 5434 posts Report Reply

  • Just thinking,

    Morgan seems to be rowing his own boat, one oar and pulling on it with all his might, after the rest of the crew went for a swim. If he pulls hard enough he might create a vortex to suck himself in, otherwise he's just saying - loook at meee!

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • tussock,

    Re: cutting benefits and such, GM's proposal doesn't do that, he's just setting them all to the same number, $10k, and not making you prove that you're sick, retarded, pregnant, a young mother, or anything else other than a real person over the age of 0 (or 18, or whatever).

    Sick people need more money? Bugger that, free healthcare, $10k's more than most are getting now to access it, and they'd get to keep it if they should pick up some light part-time work.

    Since Nov 2006 • 610 posts Report Reply

  • 3410,

    Re: cutting benefits and such, GM's proposal doesn't do that, he's just setting them all to the same number, $10k

    That much is true, but Morgan has failed to include the Accomodation Supplement (which, I'd guess, almost all beneficiaries are eligible for) in his calculations. The absolute rock-bottom rate for an "adult" Auckland beneficiary (incl. Accomodation Supplement) would, I'd suggest, be about $12k net (and only if one has no dependants, no ongoing medical costs, etc.; otherwise more.)

    Sure, the numbers could be adjusted, as GM suggests; I just think that calling $10k a standard benefit level is an error worth pointing out and hey, if "they'd get to keep it if they should pick up some light part-time work" then why not just cut benefits by 15-30% and allow that now? ;)

    Auckland • Since Jan 2007 • 2618 posts Report Reply

  • Kumara Republic,

    More wisdom from Brian Gaynor. It takes one to know one.

    Brian Gaynor: Market not up to task of closing gap with Aussies

    The southernmost capital … • Since Nov 2006 • 5434 posts Report Reply

  • tussock,

    That much is true, but Morgan has failed to include the Accomodation Supplement (which, I'd guess, almost all beneficiaries are eligible for) in his calculations.

    Perhaps. Little story about the accomodation supplement, I was a poor student renter when it came in. Flats went from $40/room/week in my area to $120/room/week in a few years, and house prices tripled not long after to match the increased rent, mostly bought up by wealthy investors as some sort of tax dodge.

    See, when you can flat in a high quality crapshack for $50/week for $50, or flat at $120/week with big screen tv, plush new furniture, free sky and all sorts of other shit we never needed, but only pay $14/week more, pretty much everyone took the plush on the government's tab. Didn't have much of an option after a while anyway.

    I know the benefits were too damn low (still are) and things were bloody rough if you had a family, but really, if they'd put the damn benefits back up rather than subsidising the investment housing market, far more people now own their own homes, and rent would be a lot more affordable.

    Typical bloody Labour under Clark. So scared to be seen helping the poor that they subsidise the rich instead, and take away a lot of chances for the less well off to get anywhere. Then get kicked out over the couple percent tax they needed to pay for the rent subsidies anyway.


    And yea, until some government gets around to a massive construction project for genuinely affordable housing (like, under $120k in the main centres), that's going to be rough on a whole lot of people if anyone tries to put it right.

    Since Nov 2006 • 610 posts Report Reply

  • Kumara Republic,

    And yea, until some government gets around to a massive construction project for genuinely affordable housing (like, under $120k in the main centres), that's going to be rough on a whole lot of people if anyone tries to put it right.

    Sadly a pipe dream for as long as McMansion developers and suburbanites who think they're environmentalists are used to having their way.

    The southernmost capital … • Since Nov 2006 • 5434 posts Report Reply

  • giovanni tiso,

    Oh, thank you for reminding me of "I am proud of this City that I have helped create." Helen Ritchie, bigger than Jesus.

    Wellington • Since Jun 2007 • 7473 posts Report Reply

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