So far, Hipkins’ only comments on tax have been to rule out a wealth tax or a capital gains tax ahead of the election on October 14.
That rule-out has proved unpopular with not only potential support partners Te Pāti Māori and the Green Party but within his own party, with David Parker this week stepping down as Revenue Minister saying it was “untenable” for him to continue in the role with him supporting a wealth tax.
The rule-out came as documents were released showing a tax-switch proposal had been worked on over the previous year but turned down at the Budget, which included a $10,000 tax-free threshold and other smaller changes paid for by a 1.5 per cent tax on net wealth over $5 million.
Finance Minister Grant Robertson said the plan “had merit” but he was a team player and accepted Hipkins’ decision.
Willis had previously claimed the Government was working on such a tax proposal but this had been rubbished at the time.
Now, Willis says Hipkins is due to announce a policy to remove the GST on fruit and vegetables. She says she understands Robertson opposed the policy but was overruled.
“Despite the serious concerns having been raised, Chris Hipkins is no longer taking his finance minister seriously and intends to announce this policy,” Willis said.
Willis said National’s preferred policy was to reduce income tax.
Green Party co-leader James Shaw said they also believed it was better to focus on peoples’ incomes.
Deputy Prime Minister Carmel Sepuloni said she would not comment on the party’s tax policy until it was released.
Revenue Minister Barbara Edmonds said she would not release the party’s tax policy without the Prime Minister.
She said other countries had taken GST off food. She said whatever tax policy the party unveiled she would make “workable”.
“Whatever the tax policy we’ve worked through, has to be equitable, has to be fair has to be workable.”
It comes as Te Pāti Māori today proposed what it says is the “most radical tax policy in a generation”, which includes taking GST off kai, or all food.
The overall plan also includes a major shake-up of income tax rates - including zero tax on income up to $30,000, all funded through a wealth tax, which they say will return $23 billion, and ending tax evasion, netting $7b.
The policies form an overall bottom line for the party to “end poverty”, with elements of the policy - such as a wealth tax - likely to be integral parts of negotiations with any party that wants to work with them after the October 14 election.
They say it will help redistribute money from the country’s wealthiest few to over 98 per cent of New Zealanders, who will get a tax cut. Only those earning over $200,000 will pay more tax under their plan.
The tax plan comes at a particularly contentious time for the Labour Government, with the Greens over the weekend doubling down in their bid for a wealth tax, saying Hipkins’ rule-out of a wealth and capital gains tax was meaningless if voters want them.
Hipkins has said he won’t budge, responding that the two smaller parties - which Labour would most likely need to work with to form a government - were “welcome” to try to get such a policy over the line without Labour’s support. He repeated that line when asked again today about Te Pāti Māori’s new policy.
Labour’s tax policy is expected to be released imminently.
Hipkins was in Christchurch to visit the Canterbury Chamber of Commerce and then to speak at the Local Government New Zealand 2023 Conference.
Speaking to media, Hipkins declined to comment on new allegations about former minister Kiri Allan’s arrest on Sunday evening and claims she had left the scene of the car crash.
He also declined to comment on a reported leak from within caucus on Monday, only saying Labour had had a “really difficult week” after Allan’s incident and had one of the “most focused and disciplined teams”.
Hipkins’ visit came after meetings with Australian Prime Minister Anthony Albanese and US Secretary of State Antony Blinken.
This morning Hipkins showed Albanese around central Wellington businesses. Albanese, in his first visit to New Zealand as Australia’s Prime Minister, was yesterday welcomed to Parliament.
The pair announced a taskforce that would look at making travel between the two countries easier, without compromising biosecurity.
Albanese is in Wellington for bilateral meetings and to celebrate Australia and New Zealand jointly hosting the Fifa Women’s World Cup.
It was the pair’s fifth meeting since Hipkins became Prime Minister in February.
Meanwhile, Blinken, the United States’ top diplomat, is also in Wellington, the first visit he has made to New Zealand and the first by an American Secretary of State since Rex Tillerson in 2017.
Blinken briefly met Hipkins before a longer bilateral meeting with Foreign Minister Nanaia Mahuta. He was welcomed to Parliament with a pōwhiri on Thursday morning. It was the first pōwhiri to take place before Parliament’s new pou, which were unveiled before dawn.
Blinken is taking after many Northern Hemisphere countries renewing their interest in the Pacific as geopolitical tensions ramp up and Pacific countries grapple with a more assertive China.
