Falloon AndrewANDREW FALLOON (National—Rangitata): Thank you Madam Speaker. I rise to make a contribution this evening on the Taxation (Annual Rates for 2020-21 Feasibility Expenditure and Remedial Matters) Bill. I would just like to congratulate the Minister opposite who just sat down the Hon James Shaw for nearly cracking a minute which I think sets a record for Government members on this piece of legislation tonight. So I do thank him for making a substantial contribution. But I do want to speak on the bill and I do so with some disappointment actually because although income tax rates remain unchanged in this legislation at least for the short term what they don't address is a wider problem in our income tax legislation. Every year in this country taxation actually goes up. It doesn't go up because the Government puts up income tax rates every year; it goes up because people move through the tax brackets and they end up paying more of their income as a proportion in taxation because it's not adjusted for inflation.Simeon Brown: It's unfair.ANDREW FALLOON: It is unfair my colleague Simeon Brown says and he gave a very good contribution earlier in the debate on exactly this point. It's been called by some to be a stealth tax because although the legislative tax rates don't increase people still rise through the tax thresholds and end up paying more as a percentage of their income than they otherwise would. On this side of the House we don't support that. We don't support tax increases every year on hard-working New Zealanders—every year seeing them end up every week with less in their pay packet than they otherwise would have if those tax rates had been adjusted for inflation.I won't be sitting on the select committee that will be considering this bill unfortunately but I hope it does come up with an alternative proposal to what's contained in this legislation. That would be a very very simple move which would be to automatically every three years adjust for inflation for our income tax rates. It would ensure that people end up paying the same rate of tax essentially every year based on their income and it puts Government in the same position as the taxpayers that they claim to represent. If we don't do that what we're left with is a bill where year after year the Minister of Finance rubs his hands with glee because he's taking more off taxpayers while they're ending up with less.I would like to address some of the better parts of this bill because there are some good aspects. The first one was touched on by my colleague Alastair Scott earlier and that relates to Mycoplasma bovis. I speak I suppose with some real sense of pleasure I suppose in relation to this part of the bill because I'm an MP who comes from an area that's been very very hard hit by Mycoplasma bovis. The electorate that I serve has had 20 percent of the cattle culled across the country. In fact 15 percent of the cattle culled have come from one district alone. That's the Ashburton district—quite a small district compared to the rest of the country. This measure in this bill as Alastair Scott has pointed out would ensure that when someone is getting an unexpected or a higher income in the year—in the tax year—because either they have received compensation or they're sending their cattle off to the works to get rid of Mycoplasma bovis which is exactly what we want that income could be spread out over six years rather than being in one tax year. So that is a very good measure and I congratulate the Minister for it.There are some other aspects to the bill which aren't too bad. One of those is in relation to deduction for feasibility and that is that the bill provides an amendment which would provide for an immediate deduction for feasibility expenditure incurred in creating completing or acquiring depreciable property or revenue account property if the total of such expenditure for the income year is $10000 or less. We don't oppose that measure per se. We do have some concerns about the $10000 threshold. And so that's I hope something that will be teased out at select committee as well. Another one in there which isn't too bad I hope is in relation to tax credits for research and development and that is an amendment to bring it into line with the eligible R & D expenditure definition proposed by the legislation which includes a novelty factor. From our perspective it will be important that we get an assurance from the select committee that the definition of eligible R & D expenditure in various other legislation is consistent with what's proposed in this legislation. So that's something I hope that the Finance and Expenditure Committee do take a closer look at.As we heard in the debate earlier New Zealanders are paying too much tax. I think Andrew Bayly despite having a reasonably short space of time to express it did get that message across very well. But that's not actually the worst part of this bill because it's not what's in this bill that I worry about so much as what's coming next. In recent months this Government has taken on billions and billions and billions of dollars of new debt. I for one actually in some respects don't have a huge problem with that because a lot of that debt is required. Some of it might not be. The $20 billion that's been set aside for example—Simeon Brown: Slush fund.ANDREW FALLOON: —for potentially a slush fund as Simeon Brown describes it. But a lot of that debt was required because was had things to pay like the wage subsidy which despite some faults kept people in jobs or at least retained jobs for a space of time to let businesses get their affairs in order. And that was a positive. That was very positive. But what I worry about is that in this bill and in other legislation that the Government's brought forward to this Parliament in recent weeks we don't actually see any sort of coherent economic plan. All we see is a tax plan. So I worry about in coming months and coming years if we don't come up with a coherent economic plan to actually get our economy moving again what it means for legislation like this and what it means for our tax structure. If you look back at recent history it's actually not too hard to look at what they might do. This is a Government that loves tax. All you have to do is look at their record on tax in the last three years. They brought in an Auckland regional fuel levy. In fact it's not even an Auckland regional fuel levy—you'll like to hear this Simeon Brown from Pakuranga—because when they brought in that legislation they didn't provide for any amendment in there that would have prevented price spreading. So what you're seeing in some parts of the country is where fuel companies are allowed to spread the price of fuel across other parts of New Zealand—less competitive markets.Simeon Brown: The Ashburton tax.ANDREW FALLOON: Well I wouldn't quite call it the Ashburton tax Simeon Brown. But certainly there are some areas that have seen elevated price levels as a result. Of course there are other fuel taxes that have been brought in. They've extended the brightline for example. That was a measure that was brought in for a very short period by the last National Government but this Government has extended it out—I think doubled it from memory. They've also increased WorkSafe levies—so that is a further tax on particularly small businesses who are unfortunately struggling at the moment; ring-fencing of losses of course; and then unfortunately the biggest one for me which is the cancelled legislative tax relief which of course the last National Government legislated for—in one of the first acts of this new Government they unfortunately axed that.The question we have now is: what's next? That's their record of the last three years in terms of tax—putting more and more taxes on New Zealanders when actually the economy has been going pretty well. So what's going to be their approach now when they have declining revenues more people out of work and more benefits to pay? Their approach will be Simeon Brown not an economic plan but a tax plan. There'll be a water tax. There'll be a nitrogen levy. They'll be whacking farmers again with the emissions trading scheme.Simeon Brown: What about a capital gains tax?ANDREW FALLOON: There'll be a capital gains tax. I'll come to that one. That's a very good one though Simeon Brown. There'll be a land tax an asset tax and of course as Simeon Brown says a capital gains tax which this Prime Minister promised was off the table but of course it'll be back because she'll be able to blame COVID-19 for bringing it back. There'll be more petrol taxes—there are some more coming up on 1 July: an increase in petrol taxes of 4c—and more increases to road-user charges but there'll be more to come and of course higher income taxes not in this bill but guaranteed to come in future years.This is a Government that doesn't have a growth programme. They don't have a plan to get our economy back on track. All they have is a tax plan and it'll be in full force if this Government by some miracle manages to get re-elected in September.