New Zealand must address international and internal trade barriers

ACT strongly supports the government’s initiative in opening up free trade talks with the European Union, said ACT leader Jamie Whyte today.
 
"More trade allows for greater division of labour and the productivity gains of specialization. Trade barriers – such as quotas, export subsidies and import tariffs (taxes) – reduce trade and hence the economic output of the countries involved," said Mr Whyte.
 
"This is true not only of trade across national borders but within nations too. Alas, New Zealand is full of internal trade barriers. That’s because most tax in New Zealand is levied only when trade occurs: most obviously, when someone pays for someone’s labour (income tax) or buys some goods or services (GST).
 
"The higher these taxes, the lower the internal trade in New Zealand and the lower the productivity of labour. That’s one of the many ways taxes don’t just transfer economic output but reduce it.
 
"Of course, the government must tax us to pay for essential state services. But it is absurd to tax people only to return the money to them in the form of “working for families” and other kinds of middle-class and corporate welfare.
 
"The money-go-round isn’t merely pointless, it reduces our productivity and output. It makes us poorer.
 
"A government that understands the importance of eliminating international trade barriers should also understand the importance of eliminating middle-class welfare.
 
"National should start unwinding the dreadful economic policies of the previous Labour government. With a strong ACT presence in parliament, it will."

Right Thinking - the word from Wellington Dec 20

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As good as it gets?

Finance Minister Bill English released the Budget Policy Statement and the Half Year Economic and Fiscal Update this week confirming we are through the worst of the GFC.  Treasury forecast an average growth rate of 2.6% over the next five years.  They characterise this as relatively strong.  However, it is significantly lower than forecast growth in a protein hungry Asia which accounts for about 44% of our trade and slightly less than Australia whose growth may, or may not, stay on forecast.  Of course some of New Zealand’s growth results from the re-build in Canterbury.  

Interestingly, Treasury note the strong increase in net permanent migration to New Zealand (17,500 in the year to October), half of which is from Australia and two-thirds of that, returning New Zealanders.  This may be a good reason to stop advocating for an extension of Australian welfare entitlements to New Zealanders as all our Prime Ministers ritually do.  

The size of government is set to grow

Mr English confirmed that Budget 2014 will achieve a forecast surplus $86million which is paper thin compared to a NZ$72 billion spend, but it’s a surplus nonetheless.  Revenue is rolling in while expenditure is constrained.  Net core Crown debt peaks at 26.6% of GDP and drops to a 22.3% by 2017/18 largely due to the improvements in the cash position.  Revenue in 2013 was NZ$61.1 billion and is set to hit NZ$84.9 billion in 2017/18.  Core Crown expenses in the same period start at NZ$70.3 billion and hits NZ$79billion in 2017/18. Treasury say we can expect a surplus of NZ$5.6 billion at the end of the forecast period assuming ongoing spending restraint.

Houston we have a revenue problem

Treasury say that tax revenue is due to grow by about 5.8% p.a. over the forecast period.  They correctly identify the risk of a change in emphasis away from expenditure restraint.  Nominal increases in core Crown expenses are driven by social programmes: social welfare benefits (the biggest of which is super and it accounts for most of the increased spend), health and education.  From an ACT perspective an expansion of poor quality social spending could start under either a National led government in its last term or an incoming Labour-led government in 2017.

Election 2014 – giving some back or more tax and spend

With more than a third more revenue forecast in 2017/18 than in 2012 the big question for election year is whose narrative wins.  The conventional wisdom is that an improving economy helps the incumbent Government.  This is likely true, however improving finances will also lead to political demands for more spending.  

Already the child poverty ‘industry’ is in high gear essentially advocating more welfare and trying to make their issue and election issue.  Labour will probably run on the gap between rich and poor, (inequality) and echo their UK counterparts.  This they will do, all the while ignoring the drivers of upward social mobility, which are not about more welfare programmes, but about better educational achievement.

National’s narrative is steady-as-she-goes and is about good economic stewardship.  Will National make even the gentlest philosophical argument about taking less in revenue from taxpayers when it conflicts with the repayment of debt line?  We know they will not undertake to address the future cost of superannuation.  They have done some reform in welfare and education and nothing particularly substantial in health, although Tony Ryall will almost singlehandedly ensure that health is not an election issue.

Making the case for slimming the State in 2014

The best way to keep on pressure to restrain spending is to focus on public debt repayment and limiting new spending which makes politicians and bureaucrats consider value for money and the quality existing programmes.  But spending self-control won’t be enough.  History is against a record of on-going restraint, politicians and bureaucrats are simply not incentivised for it.  Touchingly, Treasury have confidence that today’s politicians are keen to prepare the books for the GFC#2 sometime in the future.   Returning some revenue to the New Zealanders who generate that wealth in the first place is the only sure-fire way to slim government over the longer run and generate a higher rate of economic growth. 

Traditionally, making the early case for tax cuts falls to ACT.  In 2002 we campaigned on tax cuts.  By 2005 both Dr Brash and Dr Cullen were too.  In 2008 National campaigned on tax cuts, implemented the first tranche and ditched the rest of the programme because of the GFC. 

As New Zealand moves into the post GFC economy, the real world arguments about whether the New Zealand State should aspire to do so much for so many citizens, who could probably make better arrangements for themselves with more of their own money, will and should return.

The Wrap

RT will return on 10 January 2014.  We wish everyone a Happy and Safe Christmas and a prosperous New Year.

6.7亿元的电力改革黑洞

 

行动党领袖John Banks 今天要求工党和绿党解释“电力系统国营化计划”中6.7亿元的资金“黑洞“。

工党和绿党称新政策可以减少家庭电费7亿元。但是,天下没有免费的午餐。这些钱自有它的出处,也必然有人要为此买单。

绿党称这项政策每年只会花费政府(即纳税人)8千万元, 剩下的6.7亿元又从何而来呢?

事实上工党和绿党正打算给居民一个7.5亿元的优惠,同时用一种非透明的方式把这些钱捞回去。

公有发电厂的市值将大幅下滑,纳税人将失去他们的财产。就在昨天Contact电力, Trust 电力和 Infratil 等公用股下跌超3亿元。投资者和kiwisave持有人已经承受经济损失。

因为海外投资者担心政府粗暴干预市场,他们将远离新西兰市场。 我们急需的资本投资将越来越少,商业将停止扩展。 缺少投资将损害整个社会。

因为失去了竞争力,我们的经济将会下滑,经济增长停滞,失业率提高,生活水平降低,。

节省的6.7亿元不是天上掉下来的馅饼; 工党和绿党应该站出来承认,为这个巨大“馅饼”买单的是平民百姓。

 

——译文 (原文地址

Parker’s ignorance of Labour’s poor economic record remarkable

Labour’s David Parker has shown remarkable ignorance of his own Government’s poor economic record with his claim today that a current account deficit of 7% puts New Zealand’s economy in a ‘danger zone’, ACT Leader John Banks said today

“Under the last Labour Government, the current account deficit was 8.7%, 8.0%, 8.0%, and 7.9% of GDP in the years ended March 2006, 2007, 2008, and 2009 respectively.  But did we hear Labour warning of us of the ‘danger zone’ then?” Mr Banks said.

“Labour claims that it’s the policies of the National Government that has caused our economic growth to suffer.  But the reality is, it’s National’s failure to wind back Labour’s wasteful spending binges that’s the problem. 

“Labour’s policies of big government spending undermined the competiveness of exports and firms competing with imports, and turned surpluses in the balance between exports and imports into deficits. 

“But rather than see the error of their ways, Labour is doomed to repeat their mistakes. 

“Labour’s continued commitment to intrusive regulation of New Zealanders’ financial affairs, its antipathy to commercial enterprise and its love of big, wasteful and ineffectual government programmes show that it has learnt nothing from the mess the Clark-Government had made of the economy by 2008.  

“If David Parker and Labour are serious about improving competiveness, they should join with ACT in calling for less government spending and lower tax rates to give our internationally exposed industries a greater ability to compete.   Less restrictive labour market legislation and RMA reform would also help,” Mr Banks said. 

ENDS

低税率应惠及全民

  新西兰优先党提出给出口商设定一个较低的税率——百分之二十。该政策是一个“半生不熟”的想法。

  行动党一直认为, 低税收是促进经济增长最好的办法,优先党的做法是政党收买特定群体的典型例子。

  为什么要给出口商税收优惠,却不给与进口商品竞争的本地制造商优惠?这明显与优先党一直以来坚持的增加出口减少进口的提法相悖。

  与优先党不同,行动党认为每个人都应该从低税率中受益,而不仅仅是出口商。

  近期的财政部和IR报告发现,降低个人所得税将是提高经济福利最有效的措施。

  行动党期望所有家庭以及个人都能从减税中受益。 但要做到这一点,政府开销必须大幅削减。

  如果政府核心支出可以减少到GDP的百分之二十九, 把税率定为百分之二十, 加上百分之十五的消费税(GST),政府依然有足够的运行资金。

  如果新西兰优先党真的为经济增长着想, 他们应当支持把所有人的税率降到百分之二十以下并削减政府开销,而不应利用政府权力给予特定群体税收优惠。

 

  ——点击查看原文

Introduce a 20 per cent tax for everyone, not just exporters

New Zealand First’s policy to offer a lower tax rate of 20 per cent to exporters only is a half-baked idea best fed to the dog, ACT Leader John Banks said today.

 “ACT has always believed that lower taxes are the best way to boost our economic performance, but this is a classic example of a political party picking winners to further its own agenda,” Mr Banks said.

“Why give a tax privilege to exporters, but not to the equally valiant manufacturers competing locally with imports?  To fail to treat them equally is inconsistent with New Zealand First’s professed concern to export more and import less. 

“Unlike New Zealand First, ACT believes that everyone would benefit from lower taxes, not just exporters. 

 “A recent Treasury and IRD paper found that personal income tax reductions would be the most effective measure for boosting economic welfare. 

“ACT would like to see a 20 per cent tax rate rolled out across the board so that families, individuals, and businesses can all benefit.   But to do that we must cut out wasteful government spending.

“If core crown expenditure is reduced to 29 per cent of GDP, a tax rate of 20 per cent along with 15 per cent GST would be more than enough to fund government spending, with a substantial welfare safety net.

“If New Zealand First is really serious about boosting economic growth, they should support a lower tax rate of 20 per cent for everyone coupled with lower government spending, rather than picking specific groups to bestow government privileges on,” Mr Banks said.

ENDS

IRD/财政部:降低个人所得税是最有效的选择

  IRD和财政部发布的一份报告指出,增加经济福利的最好方法是降低个人所得税。行动党领袖John Banks对此表示欢迎。

  “行动党一直都在要求更低,更平稳的所得税税率” John Banks说。

  “我们希望在新西兰实行个人所得税单一税率,并且税率低于20%。加上GST的15%,应该足够政府开销和维持社会福利。

  西方国家已经陷入了用高税收支撑高福利的泥潭,曾经贫穷的国家和地区比如新加坡和香港用了一代人的时间就超越了新西兰,却没有随新西兰走下坡路。

  2025工作小组报告显示,如果在2009年时把核心消费减少到29% 那么把个人所得税的最高税率,公司税,和信托税的税率就可以下降到20%。

  劳动党在2004年5月到2008年9月之间的政府开销从GDP的29.1%飙升到34.6%,在国际金融危机的背景下,政府承受了巨大的财政压力。

  行动党最初的开销上限法案本该强制劳动党在获得选民同意后才能增加政府开支。我们相信新西兰仍然需要这种措施的保护。“

 

IRD/财政部报告链接:http://taxpolicy.ird.govt.nz/sites/default/files/2013-other-savings-investment.pdf

 

放弃征收停车位税是正确决定

  行动党领袖John Banks今天对国家党放弃其提出的停车位税表示欢迎。

  Banks 说 “这对奥克兰和惠灵顿中心区的小企业是个好消息,对员工更是一个好消息”。

  “奥克兰中央商务区的小企业正在挣扎着生存, 他们最不需要的就是更加繁重的管理费和税,行动党已经十分明确的反对了这个提案。”

  Banks 表示 “国家党这次做出了正确的决定” 。

-译文

 

Personal income tax reductions most effective option: IRD & Treasury

ACT leader John Banks today welcomed the release of an IRD and Treasury paper that found that personal income tax reductions would be the most effective tax measure for boosting economic welfare.

"ACT has always argued for a lower, flatter structure for income tax rates," said Mr Banks.

"Ideally we would like to see a single rate for the income tax in New Zealand, and it would not be higher than 20 per cent.  With GST at 15 per cent, that would be more than enough to fund government spending on collective consumption of the order of 6-7 per cent of GDP and a substantial welfare safety net.

"The Western World has overstretched itself with high tax rates to fund welfare dependency and once-poor Asian countries such as Singapore and Hong Kong have outstripped New Zealanders in just one lifetime, in good part by not following this degenerative route.

"The 2025 Taskforce reported in 2009 that cutting core Crown expenses to 29 per cent of GDP would, at that time, have allowed the maximum personal tax rate, and the company and trust tax rates, all to be reduced to 20 per cent.

"What made this unattainable is Labour’s dramatic increase in government spending from 29.1% of GDP in 2004/5 to 34.6% in 2008/09, which put a large strain on government finances in the global financial crisis downturn.  By increasing spending, Labour squandered the growth dividend from the very reforms that it scorned. 

“ACT's Spending Cap Bill, in its original form, would have forced Labour to go directly to the electorate to obtain its approval for its irresponsible spending increases. 

We believe New Zealanders still need the protection of such a measure.

"The latest IRD/Treasury assessment is yet another reminder of how disgraceful and economically illiterate a former Labour Minister of Finance was in dismissing sensible mainstream economic tax policy advice from Treasury as an 'ideological burp'. 

"He and his colleagues were the ideologues, and doubtless still are,” Mr Banks said.

The report can be found here: http://taxpolicy.ird.govt.nz/sites/default/files/2013-other-savings-investment.pdf

ENDS  

提高最低工资标准将使更多的新西兰人失去工作的权利

  国家党提高最低工资的决定将导致更多的企业倒闭和更高的失业率。

  在政府应当给企业发展让路的时候,国家党却把提高群众收入的包袱甩给了企业,给企业的发展制造障碍。

  中小企业占了新西兰企业总数的 97%,并贡献率了40%的国内生产总值。当前大部分中小企业生存艰难, 他们与供应商的议价能力微乎其微, 也没有能力应对持续上涨的运营成本。

  新西兰服务业者协会去年的一项调查显示, 48%的服务业业主和营业者付给自己的工资低于最低工资标准。如果雇主都支付不起自己最低工资,又怎能寄希望于他们付给雇员更高的工资呢?

  最低工资的上调将直接影响那些低收入群体,由于一些员工的边际贡献低于最低工资,在此情况下, 企业为了维持收益往往会减少雇佣人员。

  我们当然希望看到大众有更高的收入,但是,不设法提高效率而是武断地使用法规来提高最低工资只会导致更高的失业率。

 

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