2020 election: Labor ‘balanced’ fiscal plan draws criticism from political allies and Rich Lister

Labor’s new tax policy has drawn a wide range of criticism for not going far enough, but party leader Jacinda Ardern says it is “the best for New Zealand in our time.”

Although it has been well received by people like the PSA union, the Green Party and even a Rich Lister they have called on Labor for “playing” with a tax plan “far from being radical”.

The party promised yesterday, if re-elected, to introduce a new top tax rate of 39 percent for anyone who earns more than $ 180,000 a year, which would generate $ 550 million in revenue a year.

That money would go toward New Zealand’s health, education, and Covid-19 debt repayment.

Labor finance spokesman Grant Robertson said the tax would only affect about 2 percent of all New Zealanders.

If someone made $ 200,000 a year, for example, the tax would cost him only $ 23 a week, $ 1,200 a year.

And it was also good news for the other 98 percent of New Zealanders: under a Labor-led government, there would be no additional taxes.

“Our plan strikes a balance as we recover from Covid-19,” Robertson said.

“Now is the time to provide New Zealanders with certainty and confidence,” Ardern said.

Both Robertson and Ardern pointed out that even with the increase in the top tax rate, wealthy New Zealanders still pay less taxes than they would if they lived in Australia.

In fact, the proposed upper tax bracket still means that New Zealand is in the bottom third of the 36 OECD countries when it comes to a top tax rate.

And it is with this that the Green Party is opposed.

Although co-leader James Shaw said that a higher top tax rate was “way behind,” it just wasn’t enough.

“These are tweaks that will not address the long-term challenges Aotearoa faces.”

The party wants the richest in New Zealand to pay much, much more.

Shaw wants two more tax brackets added, one at 36 percent for people making more than $ 100,000 and one at 42 percent at $ 150,000.

At the moment, the highest tax bracket is 33 percent, paid by those who earn more than $ 70,000 a year.

“With the Greens in office, we will push for fiscal policy that truly addresses the challenges we face, so that everyone can live in dignity,” Shaw said.

But it seems unlikely that the Greens’ tax plan will be a reality even if it can form a coalition with Labor after the election.

Speaking to the media yesterday, Robertson said Labor’s fiscal policy would be the full scope of any fiscal change in a government led by his party.

“This is Labor tax policy. We promise not to implement anything more than this if we are in government,” Robertson said.

Meanwhile, real estate developer Troy Bowker, whose net worth according to the NBR Rich List is $ 84 million, said the policy is a clear sign that this Labor government appears to have given up on its agenda of redistributing wealth through the Tax system.

“Far from being radical, this policy could have easily come from the National Party.”

And the National Party was not happy either, although for different reasons.

“No country in the world has ever come out of recession with taxes, but Labor’s first instinct is to raise taxes,” said its financial spokesman Paul Goldsmith.

Despite Robertson’s comments that this was the beginning and the end of Labor’s tax plans, Goldsmith said this was “just the beginning.”

“The job will eventually expand the network and come after the middle-income earners.”

This prompted a loud rebuke from Ardern, who dismissed the comments as “misinformation.”

He added that National’s statement was simply “opposition policy.”

But the PSA said the new tax was a step in the right direction.

“We are pleased to see employment policies that can help turn New Zealand in a more equitable direction, and we know that PSA members will be happy to see more money available for essential public and community services.”