KEY POINTS:
If National wants to steal a march on Labour in the tax-cutting stakes, then John Key, Bill English et al should look beyond income tax and start thinking about some of the other iniquitous taxes that sap our disposable income.
What is long overdue is a complete review and overhaul of our entire taxation system, not just tinkering.
The first tax National should look at is GST, which is a double-dipping tax on our taxed income and deprives us of 12.5 per cent of our spending power.
I can think of no better contribution to the well-being of New Zealanders, particularly those on low incomes, than to make food, water, electricity, motor fuel, rates and medical expenses exempt from GST.
These are necessities and, with the exception of medical expenses, have risen in price vastly and alarmingly in the past 12 months.
I have always treated the official annual inflation figures with contempt, because I know that the things we have to buy each week have inflated in price far above what we are told is the official rate.
Take two examples, dairy food and motor fuel.
Butter has risen 91 per cent in the past 12 months, cheese 60 per cent and milk 21 per cent. Meat and fish have become so expensive that many families have to do without both.
Petrol is 24 per cent dearer than at this time last year and electricity seems always to be rising, for the power bill gets bigger and bigger. My summer power bill these days is about what my winter bill was a few years ago.
Water charges for those who live in areas where it is sold separately continue to rise as local authorities milk water-provider profits to finance other things, yet rates keep going up by much more than the official inflation rate every year.
The result is that while the Government, the producers, the suppliers, retailers and businesses in general keep on doing very well thank you, the public, as usual, is getting screwed harder and harder.
I sometimes wonder why is it that it is always the man and woman in the street and their kids who have to pay every time something happens in the system to make prices rise.
Why is it that the profits of Government and business always seem to be increasing while Joe Public finds he can afford less and less?
Does it never occur to anyone that Government and business could and should absorb some of the eternal increase in prices?
For instance, BP, always the first of the major oil companies to raise prices, was at it again this week, although international crude prices had fallen.
That's why I'd rather run out of petrol than patronise BP; if possible I deal only at Gull, which where I live is always at least 1c a litre cheaper than the others, and honours my supermarket discount vouchers.
Motor fuel is already heavily taxed, so the GST (which goes up every time the tax goes up) is, on the Government's part, triple-dipping.
As for electricity, the Government reaps untold millions in profits and special dividends from its state-owned generators, and the removal of GST from power makes eminent sense.
So, just as a start, it's time we emulated Australia and cancelled GST at least on food and medical expenses.
In Australia there is no GST on food and ingredients for food for human consumption, on beverages for human consumption and their ingredients, on goods to be mixed with or added to food for human consumption, on fats and oils marketed for culinary purposes, or on any combination of any of those.
And medical expenses incurred under Australia's universal Medicare scheme are GST-free, too.
While I'm on that subject, another big tax inequity is that premiums for private health insurance are not tax-exempt, yet those who pay those ever-increasing premiums save the public health service untold millions each year.
Another example of double-dipping is income tax charged on pensions and benefits. These, since they are paid from out of taxation, should be tax-free.
What a huge fillip that would be to tens of thousands of our least well-off citizens.
By my reckoning the Labour-led Government has introduced at least 15 new taxes in the past nine years and has presided over a vast increase in Government spending, much of it inefficient and wasteful.
This includes Working for Families and KiwiSaver, which are simply smoke and mirrors when you understand that all they are is the Government taking money out of one of our pockets and putting in the other, in the meantime wasting a fortune of taxpayer money in administration costs.
So it's long past time the whole tax structure was put under a microscope. John Key take note.