Labour has confirmed the super wealthy are legal tax bludgers
Well there you have it – in black and white. Revenue Minister David Parker has revealed what we all knew and what some of us have been saying for decades – that the wealthiest New Zealanders pay a much smaller share of their income in tax than those on the lowest incomes.
The Parker report has confirmed we have a Sherriff of Nottingham tax system where the poor subsidise the rich.
RNZ has reported:
“Our citizens like tradies, nurses, school teachers, hospitality workers, hairdressers, cleaners, engineers and small business owners all pay a much higher effective tax rate than their wealthier fellow Kiwis.”
“The project gathered information from 311 families, who generally have a net worth of more than $50 million, looking at the period from 1 April 2015 to 31 March 2021.
“Once ownership of businesses, properties and other investments were taken into account, alongside wages and salaries, their median effective tax rate is 9.4 per cent, compared with 20.2 per cent for other “middle wealth New Zealanders”. Both figures include payments like benefits and superannuation, as well as GST paid.
“Inland Revenue said a major difference was people on low to middle incomes tended to make most of their money through income that is taxed directly – that rate depended on the amount individuals earned.
“It said personal taxable income was only a “small part of the economic income of the wealthiest New Zealand families”, with most coming from “increases in the value of businesses, property and financial portfolios they own or control”, and the picture changes when that was all taken into account, referred to as “economic income”.
“That was the sum total of all of the different ways “people gain the ability to spend money… and also comes from the things you buy or own increasing in value, these things can be sold to gain the cash needed to buy goods and services” – otherwise known as capital gain”
The current tax system was designed by the super wealthy for the super wealthy and facilitated into practice by the David Lange Labour government. The responsibility for this outrage rests with the likes of David Lange, Roger Douglas, Richard Prebble, David Caygill, Michael Bassett, Phil Goff, Geoffrey Palmer and Helen Clark who sat around the cabinet table in the 1980s while tax rates on the rich were slashed, death duties and sales taxes were abolished and GST (a tax on the poor) was implemented.
Shame on all of them.
URGENT tax reform is needed. Now. Tinkering won’t do it.
The best solution is to abolish GST completely and replace it with a Financial Transactions Tax, a Wealth Tax and a Capital Acquisitions Tax
It’s time to act Labour! And let’s see these changes implemented as fast as Labour implemented the tax changes which slammed lowest-income families in the 1980s.
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