If you have earnings of $1m / annum you get – according to the government – a tax cut of $985 per week.
How can that be fair.
If you have earnings of $1m / annum you get – according to the government – a tax cut of $985 per week.
How can that be fair.
This entry was posted on Thursday, May 20th, 2010 at 5:47 pm and is filed under Pay Equity, Tax, minimum wage, national, perks, poverty. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
More than enough to hire a armed bodyguard or two to ward off the jealous masses 24/7.
and how many people earn a million per year?
Perhaps if you concentrated on “real people” and not sensationalist headlines you could not come across so poorly.
If you had earnings of $1m/annum you get to pay $380,000 in tax,
How can that be fair.
Then you can bring back the envy tax. Oops that’s right. You admitted that was a mistake. “I agree that opening the gap up between trust and the top marginal rate was a mistake and created the loophole through which hundreds of millions have been lost.”
Should be enough to save $200,000 over the next 4 years and thus invest in buying up some partially priovatised public asset at a bargain rate – to flick on for $300,000 to some foreign investor for another untaxed CG and all without using any money they had in 2010.
Chris the government used medical staff and teachers as a reason to cut the top rate – all they had to do was increase the top rate threshold.
$430Mpa of the tax cut cost goes to those on over $150,000 pa.
On the day lets try and stay on theme here folks Trevor Johnboy give his mates thousands a week in tax cuts. There’s something not quite right here.
don’t chase off thread Trevor
ditto
Trev, if you are earning a mill per year you can also own 20 investment properties and write off the depreciation so that you qualify for student allowances and working for families. How can that be fair? Why didn\’t Labour stop that from happening for years? Looks to me like the Nats plan socks it to the rich who have been rorting the system, while Labour let it happen.
I agree that that loophole should have been closed earlier and if there is a separate vote on it will support the change.
How about the tax increases that Nat has applied to those who have rorted the system benefiting from the workers honest PAYE payments that Nat of a previous generation and the majority of the current generation of Lab gave out. They maynot be obvious tax subsidies given/allowed but the was cases on individuals benefiting by many millions in a given year, which makes Paul Renolds tax cut look quite feeble in comparision. As time allows these rorts to be seen perhaps with Nat starting Lab may follow up in removing. I am afraid this may not be the case given comments from this site and the Std on keeping such things as land lords rorts available. I wonder sometimes who the left is fighting for and whe the nmy is. War can be so confusing at times !!
If I were rich I’d be happy to pay taxes!
Who cares if not many earn 1 million, those that do can afford to pay tax!
Why didn\’t labour do it earlier trev. You guys knew the rich boys were arranging their affairs to pay as little tax as poss, yet you didn\’t plug the gaps. You knew hundreds of people earning over a hundred grand a year were putting their money in trusts. Even half your MPs run trusts trev. I don\’t think you guys have a lot of credibility on this. Jumping up about a handful of guys who earn over a million a year is nothing compared to the thousands who were earning over a hundred k and were getting full benefits and entitlements by restructuring their tax.
para off thread – not on pengiun site now Trevor
Stop trying to make political mileage out of a handful of people when you guys dropped the ball on the big rorts.
in order to keep equality within NZ you have to allow equalish taxes to people
1% of people get 15% of cuts
It was an example of the rorts your government allowed trev. Let me give you another example then. Rob Rangerter (a fictional person) earns $1 million a year last year. He buys 20 properties through a company called Green Slice. He then uses the depreciation on those properties to write off tax losses against his income bringing his income down to $30,000 per year. He has five kids, including two at university. They all qualify for student allowances, and they get Working for Families. Instead of paying $350,000 tax on his income, he pays nothing. In fact he gets tens of thousands of dollars a year subsidy from the government for working for families.
Rob Rangerter, the Green Slice investor, has to pay $300,000 to the government now because the government has closed the loopholes.
There are more Rob Rangerters earning over a million a year than there are in your example Trev.
@ Mallard @ 6:43 – Yet those same people still contribute significantly more to the pot than the bottom 20%.
Thank God for that 1%
Jammy read me @ 6.33pm and go back to Nact research units drinks
Define fair…
Trev get some new attack lines. You can\’t defend your record on this and you lost the argument by coming up with stupid examples that don\’t hold water.
@Trevor Mallard
That is a non point, they shoudl have had those cuts a long time ago to equate all NZers
and without that 1% NZ would go bankrupt
People who earn the very most should pay the very most tax, full stop. Reason? Because those tax monies will help the people at the bottom and middle tiers to get by at a relatively basic day to day level, as well as providing social services and community support of benefit to all.
Sideoiler said:
Meh bad quotating soz guys.
@Jammy – Labour did a lot of repearing from the 90s, I’m sure they would’ve got around to it eventually.
I’m glad we didn’t have those tax cuts, it saved us from a very bad recession.
Labour dropped the ball spud. It is off thread to talk about all the other things in the economy where labour dropped the ball but there was plenty of that too spud.
Labour expanded working for families and raised the highest marginal tax rates knowing the wealthiest people would do their best to arrange their affairs to pay less tax. All the advice from IRD was this would happen. A survey of the wealthiest NZers shows half of them weren\’t even paying the top tax rate spud.
That\’s why Trev\’s example is so stupid.
Loota, can you please clarify: “bottom and middle tiers to get by at a relatively basic day to day level”? What is a middle tier income to you?
I do hope you’re not part of the ‘tax the rich until the pips squeak’ clan.
Nothing begets nothing – the more you earn, the more taxes you pay, the more of a tax cut you receive……or so you would have us believe.
Treasury on the other hand has predicted that in terms of a percentage of the average disposable income those with:
1 Households earning under $40K will be 0.7% better off
2 Households earning $40K to $85K will be 0.4% better off
3 Households earning over $85K will be 0.7% better off
At the risk of once again being deleted for being ‘off thread’ have just tuned in to both Close Up and Campbell Live.
Incredible! Bill English delivers the budget, John Key fronted both programmes. No sign of the budget’s architect.
My recollection is that Micheal Cullen always fronted the media after he delivered a budget. Helen Clark stayed in the background.
That tells me one hellava lot about John Key!
Trevor – how is it fair that 10% pay 75% of the tax. The system needs re-balancing. The years of envy taxes are over. You obviously need a long long time in opposition to understand that. If you and all your fellow Labour MPs feel so strongly about this then please feel free to maintain paying tax at 39% to the IRD. The rest of us will be quite happy to pay tax.
Wasn’t it great news that this package will lead to 1% additional growth and 170,000 more people in jobs – where is the downside? How many people pay 38% tax on their $1m earnings – are we talking just a few? Surely the focus must be on the positives not the negatives.
@Monty: At least one reason is because most workers are paid comparatively little. If you favour keeping wages and down for all but the so-called elites, then you end up paying the tax you deserve to pay under the circumstances. All the bleating about the comparative percentage paid by the Australian wealthy conveniently side-steps the fact that Australian workers are paid rather more, and consequently end up with a greater tax burden, thus reducing the percentage paid by the highest earners. So, if you want to pay a lesser percentage of tax, then you ought to favour greater equality, which this budget certainly did not deliver.
Well Labour had nine years to try and sort things out. All that happened over that time is the poor became indentured to the Government. The middle classes restructured their affairs, and got even wealthier. After todays budget I really think Cullen had no idea about economics. Or was too blind by socialist envy (such as Trevor has idnetified here) that the economy was one of the first in the world to enter the global recession. 7.5 more years of National Government – yeesss.
Way off threat I’m sure, Trev, but we’re unlikely to see your $1000 a week example in the media, who are falling over each other to trumpet the once in a lifetime stunning success of this tory budget. They will all be enjoying the government’s ‘hospitality’ by now. Just rewards.
Monty you are just so boring. If it was all so obvious why didn’t Nact do it last year.
In fact why did John Key promise not to increase GST both before and after the election.
Loota says:
Monty: NZ’s low public debt meant that we rode out the WFC a whole lot better than many other countries. Thanks Cullen and co. for sound fiscal management.
Of course more could have been done but Labour is looking forwards to doing it, since NACT isn’t going to
@Trevor
nation didn’t do it last year because they had to cut crazy policies that would have seen NZ go into a decade of deficits.
Most NZers are chuffed as chips with the budget (80% according to close up)
the real question is given our growth during labours time, why oh why did they increase the top rate without a mandate to do so?
Great to see that doctors, scientests, and engineers have greater incentive to stay in NZ.
P.S. Your million dollar a year example is winning you no friends, get real, bearly anyone earns that much. Let’s focus on average NZers that are all better off.
Loota there are many that would argue while we handled the WFC well once in it, it was thanks to poor fiscal management by Cullen & co that meant we were one of the first to hit a recession….before it had even become a ‘world recession’.
Trevor: yes I am curious why John Key promised that too. I just don’t see what the big deal is – I think it is good to spread the collection of tax revenue out more so that it is a little less reliant on income tax & more emphasis on consumption tax. I personally believe that it will encourage people to acquire less personal debt.
I would love to know the income bands of all those who take up the HP & interest free deals etc at the likes of Harvey Norman, Bond & Bond etc.
I would also love to know what the income bands are for all those who have Sky subscriptions.
Things gadgets, TVs & Sky will all go up. This is a good thing as there are many people who buy such things that can not afford them.
Further, and back on topic, what I find most curious is that Labour introduced GST then put it up by 2.5% without anyone so much as blinking an eye.
Why it is such a big deal now some 21 years later I don’t know – I am just thankful it didn’t go up to 20%. On the face of it it really is a modest increase.
In terms of the tax cuts…..some people pay more tax than some people actually earn in a year so of course they are going to get more money back.
Bottom like, 8% of the country should not be paying 75% of the taxes. This goes some way to address this anomaly while also FINALLY doing something about the rorters – this has made me very happy.
Loota, even Trevor acknowledged what most of us already knew, that Cullen didn’t know how to factor in incentives into budgets, and subsequently let trust income explode when he (without a mandate) increased top tax rate.
An academic yes, any real experience, no.
Trevor – Please do not be so sensitive. Last year NZ was in the midst of the worst recession since the great depression. Thanks to astute management Key and English have brought NZ out of this relatively unscathed. Last year the priorities were completely different. They have changed.
In respect of GST – Well I love the way you guys are trying to dine out on that. I Know John Key has answered this in parliament – context is everything.
What I find funny is the moaning about rich getting richer. Under Clark / Cullen I made a bucket load of money. Something I sadly will not be able to do so easily under this government.
I expect the next round of polls will prove that this is a popular budget with continued strong support for this Government. The problem for Labour is that you simply will not get any traction out of this budget.
What nonsense monty – the reason we got out of the financial crisis was that our net public debt was nil because Cullen paid it off. An Australian approach would have meant unemployment would not have gone up in same the way.
Trevor: but isn’t that precisely the same reason why we fell into recession so quickly?
@don’t be such a term deleted Trevor, all of us here know that Cullen put in place policies that incentivised rotting of the tax system, And raised the tax without a mandate by 6% but don’t worry, national are here to work it all out.
It’s telling that Monty refers to the middle classes restructuring their affirs, as if the middle class’ was the group paying the top tax rate.
It just goes to show that wages here are so low, we don’t really have a middle class, just those who like tax cuts and those dependendt on WFF to afford to house and feed their family.
Rebecca – we went into a recession caused by the RB lifting of the OCR to stop inflation. This allowed him to make huge cuts in the OCR when the GFC hit.
Trevor – how much debt did Cullen actualy pay off in real dollars?
Middle classes – well definitations will vary. I consider myself in the middle classes – wife and I both work – we have been stung by the rich prick tax and so bought investments property to offset the high tax burden. Thanks to Clark / Cullen those properties have substantially increased in value. I think the middle classes are those who can pay their bills, save some money, and generally those stung paying for Cullen’s social programs. My guess is that the middle classes are the strong support base that National is enjoying.
The issue of housing unaffordability is complex but substantially made worse by the policies of the Labour Governemnt.
Monty thanks for your weak attempts at distraction from NACT’s 2010 Budget for the Wealthy. Now, back on topic…
Monty, the worldwide increase in asset values of all types – was fuelled by loose monetary policy on a global basis. The global financial system was awash with cash – the New Zealand government had little to do with it.
Our problem was/is the lack of CGT, which explains the rapid rise of our own property (the loans came from offshore) values – the sense of wealth this generated and the resulting RB higher OCR response crashed the economy here.
All Labour did was react to the clamour to share surpluses by trying to retain graduates by offering interest free loans if they stayed and otherwise WFF to assist families – that 2005 bidding war was started by National.