I thought I would share this response to some questions we have asked in the community with Red Alert readers.
The loose translation of the Chinese text is:
Dear MP Huo, Thank you for your Labour Party who always speaks on behalf of ordinary kiwis, particularly at a time when the cost of living is increasing dramatically, well done, we support you. (name and address withheld)
This constituent echoes the thoughts and feelings of many families across the country.
It is concerning for everyone in the community that prices are rising faster than wages, and with an increase in GST coming into effect shortly, this situation is only going to get worse.
With inflation expected to hit 5.9 percent next year, it seems there is no let up for hard working kiwis either.
Any tax cuts should make it easier for more kiwis to get ahead. However, National’s tax plan gives most of the tax cuts to the privileged few. But, 70 percent of salary and wage-earners are on $40k or less, with 800,000 kiwi families with a combined household income of $60k or less.
Under National, transport prices rose 3.1 percent with higher prices for International air transport and vehicle licensing fees.
Cost of food is increasing with a recent OECD study finding that New Zealand food prices over the last 10 years rose higher than almost any other of the 30 OECD countries studies, at 42% compared to the OECD average of 33%.
Under National’s ETS, families pay twice – once as consumers and once as tax-payers ($110 billion over the next 2-3 decades) while polluters get an easy ride.
It’s disgraceful, I too am dredding the GST hike
“Cost of food is increasing with a recent OECD study finding that New Zealand food prices over the last 10 years rose higher than almost any other of the 30 OECD countries studies, at 42% compared to the OECD average of 33%.”
Sorry who was in power for 8 of the last 10 years????
The choice is less government and no wage rises, or higher cost of living. There is no middle way.
I remember when Ruth gave us less govt and wage freezes…
Of course there is a middle way LR, it just takes thinking, courage and discourse, none of which we get from any of our main parties, because they are hookd into populist, vote garnishing thinking
I think Mark was wright is portraying her as Ruth Richardstein
Price rises on their own don’t affect living standards. It is when you couple price rises with stagnant or falling wages that people struggle.
There were price rises under Labour, but the broad policy mix meant that wages kept rising in line with, or above prices.
The real problem at the moment is that we have runaway inflation at a time when wages are absolutely screwed down. National’s employment law changes will make this worse.
It is a disgrace the increased cost of living – during the Labour years electricity went up 72%, petrol got to $2.20 per litre, and inflation often breached the 1-3% target. That is a disgrace – and the cost of Living went through the roof.
At least they didn’t plan it that way, National are forcing GST up!
It doesnt do you any credit to mention the ets. Remember, under your Labour scheme “ordinary” people would be lying starving in the gutter.
Spud – I wonder if yopu are deliberately so economically illiterate. All taxpayers will get a tax cut to compensate for the GST rise and most will be better off.
National are needing to restructure the economy after 9 years of gross mismanagement whereby Cullen had the few (10% paying 78% of the tax. Clearly an unsustainable position as those 10% got sick of being fleeced to fund Clark and Cullen socialist utopia.
Good thing that about 53% of the country understand this and continue to support National as a result (although the National Party Blog does stink)
Spud, please remember history petrol went up partially due to increase of exercise tax and power went up due to price gouging and also partially as a result of the Govt requiring a certain level of divends. And where does the power coy customer base come from?
This is another case of an indirect under the table tax, which contributes to cost of living, and also please do not forgetthat the inflation calc does not take into consideration interest.
http://www.nzherald.co.nz/brian-fallow/news/article.cfm?a_id=16&objectid=10600367
http://www.nzherald.co.nz/brian-gaynor/news/article.cfm?a_id=14&objectid=10391398
raymond I also noticed the questionaire has the GST on F&V. I wonder if people would have any idea on their spend, all we hear is the $200m that it would save, unless there was an additional tax or increases to make up this $200m then we would be in the position again of just swappingtaxes. As a breakdown from Household Survey shows that those <$14k spend $10/week and the rick spend about $35/week, so removing GSt would give more to the higher wage earner $4 week than the lower $1, i.e. More for the few than the many?
You are right about being economically illiterate
I figure that somebody else with an aptitude can do the sums
From what I understand the tax cuts don’t cover the GST hike and there’s supposed to be this inflation thing as well
[deleted - offensive - warning - chris]
There, fixed that for you.
Monty, tax is not a dirty word. It’s the price you pay to live in a fair decent society. So what if 10% pay 78% of the tax. It doesn’t mean they work any harder than a person on the minimum wage working 60 hours a week to make ends-meet. It all comes down to the opportunities life gives you (how limited or not they may be) and the choices you make.
He he he
@Hero – yeah, the power and petrol thing sucked
Damian – like spud I can only wonder at how silly your arguements are – Some people on minimum wage do work hard so what – they only have a skill set that allows them to be paid that minimum wage. Renumeration is based on skills, deman, and economic contribution – the more in each of those categories then the more someone can demand. simple. If they are taxed too high (think Cullen and his economic mismanagment) the those skilled people will head off to where they can get more money / have better lifestyle. They are also the people who fund the socialism that Cullen bought votes with. The important thing is keeping skilled people in the couintry. It is of no real consequence if the minimum waged people head off.
The problem with such a small base paying the majority of the tax is that eventually they will look at their other options which is probably a three hour plane ride west on a one way ticket. That is the loss to the country. That is what National have addressed and that is why (one of many reasons) why the Nats are safe for the next 10.5 years.
Only in a textbook dream world Monty.
Look at the underemployment rates in the US. Experienced managers, graduates, experienced scientists and engineers, accountants and lawyers, forced to take low wage jobs because there is nothing available in their chosen field or profession.
No no no total misconception mate. Its not lower taxes drawing NZers to Oz its higher salaries and better career opportunities. Remember who gives a flying frak about income tax rates, its income in hand which really matters.
You can chop income taxes back by another 5% at every tier if you like, maybe even 10% and our incomes will still be behind Australia.
And as a side effect of futily dropping our tax rates, we won’t be able to run our Govt or provide our citizens with the facilities and services that they deserve.
Some solution buddy.
And lets remember why all these highly skilled and experienced people can’t find jobs.
Because the investor (asset/capital rich class) have demanded that all the corporations that they own go ahead and transfer offshore all their technology, facilities and know-how to low wage countries. The aim is to allow these corporations to maximise their profits, giving the investor (asset/capital rich) class maximum return on investment.
In this way, the capital wealthy investor class frak over their working class neighbours as the factories and offices which used to be open in the city are relocated to China and India.
LOL ‘love thy neighbour’. At least the wealthy capital/asset rich classes get a few more cents per share out of the deal.
Monty, you’ll find in Australia the top tax rate is 45c for each dollar over $180,000 and 38c between $80,000 and $180,000. Here in NZ it’s presently 38c over $70,000 but if you take into account the wage gap (~30%) and all being fair those paying 38c here will still be paying at least that in Aussie if you can get an equivalent job. For the OECD contries, the Czech Repblic, Greece, Iceland, Korea, Luxembourg, Mexico, Poland, Slovak Reupublic and Turkey have a lower top tax rate of any significance than NZ. Monty don’t be fooled, those that call the loudest for a cut in taxes are the very rich. If we didn’t have taxes we’ll be living in a feudal society.
Wow didn’t Monty know that tax rates are higher in Australia?
According to his rationale, …Australia should be doing way more crap than NZ, economically!!! I’m sure since he’s right that’s the case.
Oh I am expecting a net movement of Australians over here Monty, when the NACT tax cuts come into effect later this year. You know, because of our lower tax rates.
Loota that was the tax cut funded by tax increases!
And to think those poor Aussie employers, having to fund their employees retirement to the tune of 9% as well as pay higher wages than NZ. How do they manage to survive?
Now we have a lower business tax rate ( funded by borrowing!) and lower employee costs, expect an flood of Aussie companies setting up shop here!
Can’t really see Aussie companies coming here, after all we don’t like people being successful do we now.
One of the worst aspects of this current government is that they are continuing to lie about the impact of the GST increase and other price hikes. They still maintain the tax cuts will leave nobody any worse off.
In 12 days time Carolyn and I are leaving to live in Brisbane. The attractions are climate, relaxed lifestyle and going to a country with a Labor government. Oh, and leaving a country whose PM is a deleted personal Clare with a persistent, smug, silly smirk on his face 24/7, who believes people will swallow deleted.
P F , you should reconsider leaving NZ , as John Key has come out saying he has a long term plan to improve NZ climate. In the short term he is offering the rainy weather as a feature.
I wonder why Peter will not stay here to support Labour (is this a sign of decreasing support numbers for Labour in NZ?) and should Labour win the next election, will he return? I will feel for him if Julia gets voted out in Australia.
The tax rate is not the reason I am thinking of moving to Australia. Skilled workers with my qualifications and experience get double what I am paid here in Australia and I have no objection to 45 c on the dollar tax on a decent pay.
Our wages are kept down in NZ in my job because employers are allowed a constant stream of immigrants who take jobs here to get a NZ passport so they can work in Australia. Tax is not the reason we are losing skilled people. It is because the only skill that is valued here is bean counting.
I still think though some of us should stay in NZ to fight the neo-lib meanness for the sake of our kids. I will probably stay.
The price of food has gone up as we only have two major supermarket chains who have the ability to charge whatever they want as they know there are no cheaper options. In a way the commerce commission is at fault of this allowing progressive enterprises to buy out the woolworth chain back in 2002 when prices were still very cheap. They should now be welcoming new supermarket chains such as Aldi etc. with open arms in order to provide some stiff competition to Foodstuffs and Progressive who are making billions every year. The price of food has gone up because both companies are greedy and can not get enough money. I hope Aldi opens here soon to ensure that the other supermarket chains lower their prices. The anti competition watch dog should be making it easier for overseas businesses to set up here and provide some much needed competition.