Hide Rodney: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — In Committee Procedure 
Text is incorporated into the Bound Volume 
Hide Rodney: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — In Committee Procedure 
[Sitting date: 14 December 2004. Volume:622;Page:17818. Text is incorporated into the Bound Volume.] 
RODNEY HIDE (Leader—ACT) 
: 
 It was marvellous to see David Cunliffe stand up and explain this bill but did he talk about the annual tax rates? No he did not. He was prepared only to stand up and debate the title to explain it to the listening public and to have that recorded in  
Hansard. 
 One of the problems with Dr Cullen’s history degree and with Mr David Cunliffe’s studying away at Harvard—[ 
Interruption 
]—and they have worked at this—[ 
Interruption 
] 
The CHAIRPERSON (Hon Clem Simich) 
: Order! Twice was enough. 
RODNEY HIDE 
: The trouble with Mr David Cunliffe and Dr Michael Cullen is that although they have done all that studying they have not worked out a couple of basic things that every household in the country can grasp. The first is that Michael Cullen thinks there is something magical about a dollar that he takes from a working person and spends. He says: “When I spend the money it’s not inflationary.” But then he comes out with this Labour Party doublespeak that if he lets the poor worker keep the dollar in the first place that is called spending. When this Government talks about tax cuts it says they are like spending money. They are not like spending money; a tax cut is just letting people keep what they earn. I would like David Cunliffe to reflect on that and explain how a tax cut can be spending money. It is not spending money; it is letting people keep what they earn. If I as a Government take a dollar from someone and spend it as Michael Cullen does it is called tax and spend and I understand that. If I let the worker keep that dollar it is called letting him keep it—it is not spending the money. 
Another thing that Michael Cullen and David Cunliffe cannot understand but everyone else can is that tax does matter. 
John Key 
: That’s right. 
RODNEY HIDE 
: Tax does matter. Michael Cullen has stood in this Chamber time and time again and said that it does not matter how much tax we take from people—that they will work just as hard they will invest just as much and they will be just as entrepreneurial no matter what. That defies all experience all logic all common sense. When he reaches around for an example to illustrate his great economic insight he draws upon the experience of MPs and he says that Labour Party MPs would not work any harder or any less whether or not they had a tax cut. Well I have to explain to Mr Cunliffe and to Dr Michael Cullen that tax does matter and people are not stupid. They are not going to work their guts out and they are not going to invest their dollars in a country where the Government comes along and takes the money from them—takes away any reward that they get. That is what this Government is doing. We are in a situation now where working people face an effective tax rate of 91c in the dollar. If people double the number of hours they work they find that for every extra dollar they earn they get to keep only 9c. 
Well I do not think David Cunliffe would do that. I do not think Michael Cullen would do that. Yet they stand up here and pretend that tax rates do not matter. Well Mr Cunliffe is absolutely wrong. He should be taking this money and returning it to New Zealanders as part of a Christmas bonus. I say to Mr Copeland that he is well on the way with his proposal to increase the thresholds but would it not be better to drop the tax rates and actually drop Government expenditure? It seems quite simple to me when one sees how Trevor Mallard Steve Maharey Parekura Horomia and Jim Anderton spend money— 
Jill Pettis 
: When you see how Donna spends money. 
RODNEY HIDE 
: Jill Pettis raises a good point. Where did Donna Awatere Huata get the money from? The Labour Government! The Labour Government gave it to her. Trevor Mallard gave the money out. It is very very simple. Trevor Mallard gave the money out so Donna Awatere Huata spent it. That is the trouble with our taxation. We would not see that I say to Mr Mallard if people were spending their own money that they had earned—not that member spending other people’s money.