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National and petrol taxes – when journalists gets it right

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It’s not often that it happens, but every so often one will stumble across examples of journalism that probes deeper than the immediacy of the here-and-now, and actually takes a step back in very recent history to put political events and utterances into context.

National’s desperation to remain relevant involves a two-pronged strategy to promote Simon Bridges as Prime-Minister-in-waiting and to portray the current coalition government as tax-and-spend and wasteful with our tax-dollars.

With Mr Bridges at 6% in the polls, the first of National’s strategy is stuck firmly in a political mire. The public do not seem to like and/or trust the current National leader. His constant barking-at-every-passing-car and relentless negativity (without proposing alternative solutions) is problematic and his hyper-critical, carping style is a major turn-off with voters.

The second prong of National’s grand strategy – to throw as much mud as possible at every part of the Coalition’s activities – continues at full-throttle. It’s success is yet to be determined.

National’s current attack focuses on  petrol prices, with the Opposition and it’s leader blaming the Coalition for high fuel prices. This despite Gull NZ’s general manager, Dave Bodger, stating that lack of competition was the deciding factor in fuel pricing, not government taxes;

“That restricts the supply, which inflates the price, especially if you look in parts of the South Island and areas where there’s not as great competition; the consumer is paying a lot more than they are in other places.”

The Commerce Commission’s recent investigation and report into the fuel industry criticised excessive profit-taking by some petrol companies. As Commerce Commission chairperson, Anna Rawlings stated unambiguously;

“Our preliminary findings suggest that many fuel companies are earning returns on investment that are higher than what we would consider a reasonable return to be.”

Those facts did not prevent National from issuing countless press statements and bombarding social media to smear the Coalition as culpable for high petrol prices;

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Fairfax/Stuff journalist, Henry Cooke, reported Simon Bridges’ attack-point verbatim;

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“I agree with Jacinda Ardern that New Zealanders are being fleeced, but the reality of this is the biggest fleecer isn’t the petrol companies, it’s Jacinda Ardern and her Government. Jacinda Ardern is the fleecer-in-chief.”

But then, Mr Cooke, took a further step. He delved into the past and with a few clicks of research, offered readers some further salient facts;

He said fuel taxes were rising by 24c over this Government’s term, compared to just 17c over nine years of National. But this figure included the 11.5c Regional Fuel Tax which is only charged in Auckland – where fuel is typically cheaper than other parts of the country – and did not include the GST rise his Government brought in.

National raised fuel taxes six times over nine years in Government, raising the price by 17c in total. The National Government also increased GST from 12.5 to 15 per cent.

The Labour Government has raised the excise by 7c so far this term and will raise it by another 3.5c in July next year. 

Which helps put current fuel excise rises into some context, when a journalist reminds readers that National was not averse to doing precisely what it self-righteously condemns the Coalition government for doing.

Not forgetting that as well as raising GST (despite promising not to do so), National’s tax-grab reached deep into the pockets of newspaper boys and girls, in a desperate effort to balance their books and make up for billions of dollars squandered in two tax cuts.

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Simon Bridges’ hypocrisy was underscored when Henry Cooke finished his story with the National Party leader’s comments;

Asked if he would cut excise taxes if elected he was non-commital, saying he would need to have a better look at the books when coming to Government.

He stood by the general user-pay system in transport, whereby fuel taxes fund major new roading infrastructure, rather than the general tax take.

The public’s collective eye-rolling at Mr Bridges’ “bob-each-way” explains why he is on 6% in the polls. This is not a politician who “means what he says, and says what he means”.

The following day, on Radio NZ’s deputy political editor, Craig McCulloch, also took National to task on its criticism over fuel excise taxes.

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On Checkpoint, on 21 August, Mr McCulloch  presented listeners with a refresher course in recent political history;

“By the end of it’s three year term, the [Coalition] government will have put up petrol taxes by ten and a half cents, not including the eleven and a half cent regional fuel tax in Auckland.

When National was in charge it put up taxes by seventeen cents, but over a much longer nine year period. But National also increased GST from 12.5% to 15.”

Embarrassing stuff.

Mediaworks/Newshub had also pointed out the same hypocrisy from Nation, but a few months earlier. Dan Satherley and Lisette Reymer reported in early July;

Between 2008 and 2017 National raised petrol taxes six times, usually by 3c – Simon Bridges was Transport Minister for three of those years. They also increased GST from 12.5 to 15 percent.

But more conspicuously, despite considerable media exposure; spending considerable effort and money on wide-reaching social media propagandising, aside from the Auckland regional fuel tax,  National leader Simon Bridges has refused to state if he would repeal the Coalition’s fuel tax excise increases;

“Right now, in the Transport Budget, they have dramatic underspends. I wouldn’t put the [taxes] on, my inclination would be to not have them, but if you are already there and they are already there, there is no way I am putting more on.”

That’s because last year, Mediaworks/Newshub pointed out that National and Labour have both increased fuel excise taxes by almost the same amount. (Though it is unclear from  the infograph below if Mediaworks/Newshub have factored in National’s GST increase in 2010.)

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It’s a fair bet that National will not be using the above infographic in any of their attack ads. Too close to the inconvenient truth for one thing.

It’s also a fair bet that National will retain the Coalition’s excise fuel tax increases; add a few of their own; and then offer a “neutral tax switch”. That’s because National believes in user-pays for most, if not all government services. In 2014 the NZ Labour Party kindly put together a list of just some of those government service fees increases;

  1. GST increase from 12.5% to 15%
  2. Increased taxes on KiwiSaver
  3. Compulsory student loan payment increase from 10% to 12%
  4. Increased tertiary fees
  5. The 2012 ‘Paperboy’ tax
  6. Civil Aviation Authority fees rise
  7. Additional fuel tax increase of 9 cents with annual CPI increases locked in for perpetuity
  8. Road User Charges increased
  9. New annual student loan fees introduced
  10. Massive unnecessary ACC levy increases
  11. Prescription fees increased by 66%
  12. New online company filing fees imposed on businesses
  13. Creeping expansion of the scope of Fringe Benefit Taxes – National tried to tax car parks and plain-clothes police uniforms
  14. Lowering of Working for Families abatement threshold and increasing the abatement rate, taking money out of the pockets of families
  15. Imposing a $900 Family Court fee

Whether fees for DoC huts and tracks, the Family Courts, ACC, roading, etc, National has never been averse to loading costs of those services onto individual users – whilst then cutting income taxes.

This is precisely what they did from 2009 to 2017.

We can expect more of the same from National should they be returned to power.

In the meantime, kudos to Henry Cooke, Craig McCulloch, and other journalists, for  delving into National’s past track record on this issue. This is the sort of journalism the public rightly demand – not simply cutting-and-pasting Party press releases.

The media should now press Mr Bridges harder on this issue: will he repeal Labour’s fuel excise tax increases or not? It’s a simple enough question. After all, he was 100% adamant that National would scrap any Capital Gains Tax if it became government;

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If Simon Bridges wanted the increased fuel excise taxes dumped, there is no reason on Earth why he wouldn’t commit. The fact is that National supports user-pays charges and their claims of being champions for “Kiwi battlers” is populist rubbish. National’s plans are blindingly obvious;

  • increase user pays charges, excise taxes, etc
  • cut personal income taxes – especially for the wealthy

Hence why Mr Bridges has said repeatedly;

“We will not introduce any new taxes during our first term.”

The caveat, Ifs, Buts, and fine print underlying that statement should not be lost on anyone.

If the (current) Leader of the National Party cannot be straight up with voters as to what his intentions are (on any issue!), then he cannot be trusted to lead this country.

For Simon Bridges, the timer on his political career is counting – downward.

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Postscript 1

Fuel prices in New Zealand Aotearoa from 2005 to 2019:

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A bit embarrassing for National: fuel was more expensive during their term in office. New Zealanders cannot afford a National government it would appear.

Postscript 2

Interesting to note that National’s spin doctors appear to have ‘borrowed from my “That was Then, This is Now” memes on which to base their own “What she said, What she did” propaganda;

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But we’re all aware by now that National is not averse to ‘borrowing’  from other peoples’ creative efforts – without paying.

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References

NZ Herald: Latest political poll – National rises against Labour, with 45 against 43 in 1 News Colmar Brunton poll

RNZ: Fuel prices – Government urged to free up wholesale market

Fairfax/Stuff media: Jacinda Ardern says New Zealanders are being ripped off over petrol

National Party: Axe the Tax

Twitter: National Party – petrol prices – taxes – 5.52 PM, Jul 24, 2019

Twitter: National Party – petrol prices – taxes – 6.26 AM, Aug 23, 2019

Twitter: National Party – petrol prices – taxes – 7.15 PM, Aug 21, 2019

Twitter: Simon Bridges – petrol prices – taxes – 2.49 PM, Aug 20, 2019

Twitter: National Party – petrol prices – taxes – 10.25 AM, Jul 1, 2018

Twitter: National Party – petrol prices – taxes – 9.40 AM, Jun 30, 2019

Twitter: National Party – petrol prices – 4.05 PM, Aug 29, 2018

Fairfax/Stuff media: Petrol prices – Simon Bridges says Jacinda Ardern is ‘fleecer-in-chief’

Fairfax/Stuff media: Key ‘no GST rise’ video emerges

Fairfax/Stuff media: Young workers out of pocket

RNZ: Blame game in Parliament over high petrol prices (audio-link)

Mediaworks/Newshub: Fuel tax hike – How much it might cost you

Mediaworks/Newshub: National’s Simon Bridges refuses to say he will overturn new petrol tax increase

TVNZ/One News: National promise no new taxes and repeal of Auckland fuel tax in first term

Mediaworks/Newshub: Fact check – Who taxed your petrol the most – Labour or National?

Fairfax/Stuff media: Trampers torn on price hike for New Zealand’s Great Walks

RNZ: DoC fees rise

Labour Party: At least 15 new taxes under National

Scoop media: National would repeal Capital Gains Tax

National Party: National would repeal Capital Gains Tax

Twitter: Simon Bridges – no ifs no buts no caveats – 6 March 2019

Twitter: Simon Bridges – tax cuts – 2.58 PM, Jan 30, 2019

Otago Daily Times – National: No new taxes in the first term

NZ Herald: National Party found guilty of Eminem copyright breach

Addition

Fairfax/Stuff media: Intolerance fed by wrong and hateful assumptions is all the rage right now

Fairfax/Stuff media: National’s ‘desperate’ attack ads to be investigated by Advertising Standards Authority

Previous related blogposts

That was Then, This is Now #28 – John Key on transparency

Simon Bridges: “No ifs, no buts, no caveats, I will repeal this CGT

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This blogpost was first published on The Daily Blog on 25 August 2019.

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Facepalm #4: John Key (again)

From a speech John Key made in January 2008

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"Well, I've got a challenge for the Prime Minister.  Before she asks for another three years, why doesn't she answer the questions Kiwis are really asking, like... [...]    Why are grocery and petrol prices going through the roof?"

“Well, I’ve got a challenge for the Prime Minister. Before she asks for another three years, why doesn’t she answer the questions Kiwis are really asking, like…
[…] Why are grocery and petrol prices going through the roof?”

Acknowledgement:  SPEECH: 2008: A Fresh Start for New Zealand

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Five years of National government later,

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NZ petrol prices reach record high

Acknowledgement:  NZ Herald – NZ petrol prices reach record high

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Yes, Dear Leader – Why are grocery and petrol prices going through the roof ?”

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johnstewart_facepalm

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Budget 2013: petrol taxes

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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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Young workers out of pocket

Acknowledgment: Fairfax Media – Young workers out of pocket

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