Cullen Michael: Taxation (Personal Tax Cuts Annual Rates and Remedial Matters) Bill — In Committee Third Reading 
Cullen Michael: Taxation (Personal Tax Cuts Annual Rates and Remedial Matters) Bill — In Committee Third Reading 
[Volume:647;Page:16300] 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 After 5½ years of the National Party saying that tax cuts are the only important thing in life the only thing it can find to criticise in this bill is something that was in the original legislation—that is the in-work payment is reviewed on a regular basis not automatically indexed. That was in the original legislation. 
Dr the Hon Lockwood Smith 
: Why didn’t you tell us? 
Hon Dr MICHAEL CULLEN 
: Because it is in the original legislation. This is no change. It has always been there and it is required to be reviewed by the end of June this year. This is all National members opposite can find to criticise. 
I want to tell the Committee that this morning the leader of the National Party has finally told us what National’s tax policy is. It is that National does not have one. He said that National had always had one but actually it was still developing it that actually it had not got it yet and that it would not be announced until 4 weeks out from the election. Then he told us two other things. He told us that Working for Families would not change—not at all. He said that it was structured badly but that it would not change under a National Government. Then he said that a National Government would have bigger tax cuts but they would not necessarily be more expensive. Those who got through arithmetic at school should try that one on for size: National would have bigger tax cuts but they would not be more expensive! You know loose lips sink ships and that ship is starting to look very very dodgy with a pair of loose lips out there that cannot stick to a single line. But best of all on Radio New Zealand National this morning Mr John Key announced that tax cuts are not the only thing that matter in life. Having said yesterday: “I believe in tax cuts.” he said today: “Actually it’s not very important. A lot of other things are important.” Then he told us in terms of the offset for increased tax cuts that Government spending is nice but that sometimes it is a luxury. A luxury for whom? Is it a luxury for those who depend on the support in the education and health systems? 
We are going to see a National Party programme that depends upon cutting social spending to fund smaller tax cuts for those on low incomes because Mr Key did not commit himself to the second and third stages of this programme. He said that what happens on 1 October will not be changed but then he said: “We won’t commit to what happens after 1 October.” That is code for cutting the tax cuts for those on low incomes to increase the tax cuts for those on big incomes. That is how we can have bigger tax cuts that do not cost more money because those tax cuts are redistributed upwards. 
That is why Dr Lockwood Smith a man who spends a lot of his life thinking deeply—it shows on his brow which is furrowed so deeply with that deep thinking—can find only one thing in this bill to criticise: that is it does not change the existing legislation which does not provide for indexation for the in-work tax payment. It provides for a regular review of the in-work tax payment. The family tax credits and the abatement threshold are subject to automatic statutory-based indexation. This part brings forward that indexation from 1 April next year to 1 October this year so that families in New Zealand will get some compensation for the increase in food prices and fuel prices. 
If the National Party really thinks this is all bad then its members should vote against it. They should vote against this bill but of course they do not have the bottle to do that so they will vote for it.