Budget 2013: petrol taxes

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Source

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“National is not going to be raising GST. National wants to cut taxes not raise taxes.” – So saith Dear Leader at a 2008 press conference. (see: Key ‘no GST rise’ video emerges)

Sure enough, in April 2009 and October 2010, National cut taxes.

As Key said in 2009,

“…The tax cuts we have delivered today will inject an extra $1 billion into the economy over the coming year, thereby helping to stimulate the economy during this recession. More important, over the longer term these tax cuts will reward hard work and help to encourage people to invest in their own skills, in order to earn and keep more money.”

Source: NZ Parliament -Tax Cuts—Implementation

Bill English and Peter Dunne issued a joint statement in 2010, which said, in part,

“Lower personal tax rates reward effort and give people an increased incentive to up-skill, develop new products and services, and get ahead under their own steam. This has strong benefits for the economy…

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… A person on the average annual wage of about $50,000 will get a weekly income tax cut of about $29 a week. Even after the increase in GST is taken into account they are more than $15 a week better off if they are paying an average rent or mortgage.”

Source: Beehive.govt.nz – Fact sheet – Personal tax cuts

Except… it was jiggery-pokery, and with a sleight-of-hand trick, National recouped much of the tax cuts by raising taxes elsewhere.

2010

– GST was raised from 12.5% to 15% – despite Key promising in 2008 that it would not be increased. (see: Key denies ‘flip flop’ over GST increase)

– tax increases for property investors (see: BUDGET RELEASE: Property tax changes increase fairness)

2011

– Cuts to Working for Families and increase in Kiwisaver payments (see: Budget 2011: Battlers asked to give back)

– Tax exemption removed for employer contributions and halving of  member tax credit (see: Experts stunned by KiwiSaver tax grab)

2012

– Children earning less than $2,340 per year to be taxed. (see: Young workers out of pocket)

– National announces Road User Charges to increase (see: Petrol, road charges hikes are ‘bad news‘)

– Student loan repayment rate increased to 12% (see: Budget 2012: The main points)

– Prescription items increased from $3 to $5 each (see: Budget 2012: The main points)

– Holiday home tax deductions cut (see: Budget 2012: The main points)

– Three tax credits dumped (see: Budget 2012: The main points)

2013

– 3 cents per litre increase in the price of petrol (see: Govt to hike petrol taxes and road user charges 9 cents over three years)

2014

– 3 cents per litre increase in the price of petrol

2015

– 3 cents per litre increase in the price of petrol

 

The up-shot?

1. National pretends to be the Party of low taxes. It is not.
2. National won an election in 2008 on promises of low taxation. It lied.
3. National’s tax cuts benefit the top 1% whilst increases in other covert-taxation has less impact on them. This is true.

Moral of this story #1;

When National promises tax cuts, ask yourself,

• Who pays?
• What other taxes will be quietly  increased?
• Who really benefits?

Moral of this story #2;

When Labour, The Greens, and Mana promise a new tax – eg; Capital Gains Tax – at least you know what you’re voting for.

Moral of this story #3;

On a scale of 1 to 10 – one being the most world-wise and street wise person on the planet, and 10 being that you hold shares in the Wellington Harbour Bridge – how gullible are National voters?

Just something to remember next time you’re filling up your car.

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Acknowledgment: Fairfax Media – Young workers out of pocket

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