Rich Katherine: Taxation (Annual Rates and Urgent Measures) Bill — In Committee 
Rich Katherine: Taxation (Annual Rates and Urgent Measures) Bill — In Committee 
[Volume:628;Page:754] 
KATHERINE RICH (National) 
: 
 As I rise to speak on the Taxation (Annual Rates and Urgent Measures) Bill I have to make a comment about the wonderful piece of nostalgia that that speech was. Mr Woolerton has given me the opportunity to have an appreciation of what the National Party must have been like 30 years ago when I was a child. 
Kiwis doing their pre-Christmas light reading who cast an eye over this bill will be extremely disappointed. Those hard-working Kiwis who are looking for a bit extra in their pockets before Christmas will be very disappointed. Part 1 confirms the tax rates as they stand. It confirms that there will be no additional relief for those Kiwis who have worked all year and made a huge difference to this country. They have got up every morning and done the right thing—they have gone to work paid their bills and paid for extras for their kids—but there is nothing extra in this bill for them. 
I want to talk about middle-income New Zealanders—who are somewhat amorphously called “middle New Zealand”. Those are the Kiwis who pay for everything. They pay for their medical bills. They pay a lot of education fees. They pay for everything. They do not get any handouts from Work and Income they do not get any extras and they are currently struggling to pay their bills. There is nothing in this bill for them. There is nothing for the hard-working electricians plumbers and gasfitters who have been coming to talk to our select committee week after week. [ 
Interruption 
] “The Grinch Who Stole Waimakariri” is sitting over there. He should be wanting to play Santa to some of his hard-working constituents. There is nothing in this bill for those Kiwis—nothing at all. 
I take issue once again with Mr Woolerton. I cannot believe that John Key would stand in this House speak to this bill and not mention tax cuts. That member has lived and breathed that policy for the last 6 months. 
That policy I think shows a fundamental difference between the parties. National believes that New Zealanders deserve to keep more of their own money in their pockets. Labour believes that it is best to take that money out of their pockets then to hand it back and it expects those who do get something back to be gracious for that support. We believe that New Zealanders can make up their minds about how they spend their money. We trust them to spend their money in the ways they see fit and we do not make any judgments about who deserves tax relief more than anybody else. One of the things we find with some of the tax plans put forward by Labour is that they are very selective indeed. There will be nothing for a person who happens to be a single worker without children. There will be nothing for a person who happens not to be a student with a student loan. 
One of the things we will find when the Government starts to dabble with the present tax system is there will end up being distortions. Already we are seeing some students saying they will take out a greater loan because it is free—they are actually financially motivated to do so. Labour does not think that will happen but there is not one single person who understands the way financial markets and financial incentives work who would say that students will not be encouraged to take out additional funding and invest it if they are able to do so. 
We have seen some interesting comments about inflation. I wonder why Dr Cullen thinks that if New Zealanders spend their own money it is inflationary but if the Government cranks up the amount it spends it is not inflationary. I would have thought that a dollar was a dollar no matter how it was spent. So that is an interesting selective view of economics. 
One of the things National believes in is a move towards flattening the tax rates. It is not just National that is saying that; Treasury is also saying it. We need to simplify the tax system we currently have yet every single idea put forward by Labour will just add a greater amount of complexity to the current tax rates and will not introduce any greater amount of simplicity at all and that will make administration costs a lot higher. I would like to hear Dr Cullen talk about what the cost will be of the implementation of the Working for Families package—a churning process that will take money from New Zealanders only to hand it back with the Government expecting them to be gracious for the donation.