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Home / Hawkes Bay Today

Mike Williams: How National’s tax plan will hit the regions in the pocket

Hawkes Bay Today
8 Sep, 2023 10:49 PM4 mins to read

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Christopher Luxon speaks at the Stortford Lodge sale yards in Hastings on Monday. Photo / Warren Buckland

Christopher Luxon speaks at the Stortford Lodge sale yards in Hastings on Monday. Photo / Warren Buckland

OPINION

The election campaign is well under way, with National’s tax policy announcement flopping and Labour pleasantly surprising with its dental health policy at its launch.

Having organised four launches while Labour’s campaign manager, I am interested in such occasions. I attended the party’s launch as usual.

This event was unusual in two undesirable ways, reflecting the divisions in society exacerbated by the pandemic.

First, those attending were scanned on arrival as if boarding an aircraft or entering a jail. Second, a demonstration by followers of the Freedom Party chanted incoherently in front of the Aotea Centre, trying unsuccessfully to block entry.

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Five of them infiltrated the Aotea Centre for the purpose of standing up and shouting while Prime Minister Hipkins was speaking.

The attendees rapidly worked out how to counter these unprecedented interruptions by rising to their feet and drowning out whatever was being shouted with Labour Party slogans while ushers quickly removed the interlopers.

All that was achieved by these disruptions was to show how quickly Chris Hipkins can think on his feet.

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A malign outcome of the internet is that the fringe, represented by anti-vax, anti-mandate, and conspiracy-based parties, have managed to unite into the sort of rowdy mob I witnessed on Saturday.

One test of this lot’s electoral attraction was the Hamilton East by-election where Donna Pokere-Phillips, co-leader of the Outdoors and Freedom Party, scored less than 1 per cent of the vote and a second is the level of vaccination reached.

In my DHB region, 98 per cent of those eligible got both jabs. People like those attempting to disrupt last Saturday’s meeting are a noisy minority but a tiny one.

Meanwhile, National’s tax policy became an embarrassment when it emerged that its plan to tax non-resident foreigners who buy houses costing more than $2 million fell foul of New Zealand’s many tax treaties which explicitly prohibit just such an impost.

As several commentators pointed out, even if such a tax were possible, the supposed outcome of $740m per annum (to fund tax cuts) is a pipe dream based on a NZ property market of a size that doesn’t exist, never has and never will.

National’s finance spokesperson, Nicola Willis, admitted on Q+A that the tax treaties which ban this tax had not been noticed or considered when the policy was developed.

Small wonder that economist Shamubeel Eaqub told Newshub Nation that National’s revenue estimates from this tax were “bulls***”.

This is plain sloppy and a reminder of Paul Goldsmith’s double counting blunder which severely damaged National’s economic credibility during the 2020 election campaign.

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The party’s intention to realise $179m a year by taxing online gambling is also unlikely to work. It is simple to evade this tax via Virtual Private Networks (VPNs) of which dozens are available.

There’s one aspect of National’s tax proposals that I believe will hit Hawke’s Bay pockets.

National intends to abolish the regional fuel tax, which applies solely to Auckland, and which Auckland Mayor Wayne Brown calculates will create a $2 billion hole in the city’s transport budget.

I don’t know of any Aucklander who resents this tax - the city has unique and expensive transport challenges and Auckland’s rapid population growth means that this spending can’t be avoided.

The result will be that the people of Hawke’s Bay will have to contribute more to the cost of Auckland’s transport.

As an Aucklander, can I say that we don’t want or need to saddle Hawke’s Bay folks with our transport problems.

Make a point of asking your National candidate what this will cost Hawke’s Bay.

Another alarming feature of National’s policy is its intention to loot $2 billion from the Climate Emergency Response Fund to finance tax cuts.

This money is intended to fund climate change initiatives so this is another part National’s abandonment of measures to combat climate change.

It is incomprehensible that the painful lesson this approach dealt to National’s sister party in the last Australian federal election has gone unnoticed.

To remind Mr Luxon, the Liberals lost six of their safest seats to Teal Independents on exactly these climate change issues.

On a lighter note, Bob Jones, commenting on my previous column (not a “press statement”), wants me to bet that the forthcoming election will be close as he’s predicting a right-wing landslide.

The fact that no poll has predicted a right-wing majority of more than two seats – not a landslide - I’ll give Bob the chance to abandon (or renew) his challenge.

Mike Williams grew up in Hawke’s Bay and is a former Labour Party president

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