Carter David: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — First Reading 
Carter David: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — First Reading 
[Volume:616;Page:12503] 
Hon DAVID CARTER (National) 
: 
 One always knows that the Government is trying to rush legislation and not have debate when it gets the junior Government whip Darren Hughes to rise to his feet to make a few comments about a tax bill that he has only just picked up off the Table and does not have a clue what it is about. 
Hon David Benson-Pope 
: He doesn’t pay tax. 
Hon DAVID CARTER 
: I am not sure about that. I start my contribution by concentrating on the parts of this bill that the Associate Minister of Revenue—the junior Minister—the Hon David Cunliffe forgot to mention when he made his speech to the House an hour or so ago. It has long been accepted that when a Minister comes into this House to introduce legislation before it goes to a select committee he or she spends that 10 minutes honestly outlining what the bill does. I listened with interest to the words of the Hon David Cunliffe and I never heard him at any time at all refer to the most important part of this legislation—the most critical part and the reason we are having to rush this legislation through—Part 1 which sets the annual rates of income tax for the 2004-05 year. It is little wonder that— 
Hon David Cunliffe 
: I raise a point of order Madam Speaker. I seek leave to table a copy of the speech. 
Madam DEPUTY SPEAKER 
: The member knows that it is not on to interrupt another member’s speech. I apologise. 
Hon DAVID CARTER 
: I can understand why the Minister is somewhat wounded. It is also apparent to me that whenever there is unpopular legislation to be introduced the real Minister of Finance and Minister of Revenue always manages to ask his junior David Cunliffe to come down and do it for him. David Cunliffe acknowledges that. A discussion probably occurred on the 7th floor whereby Dr Cullen said he would prefer not to introduce the bill because it is not one he is proud of. I accept that that was probably the case so David Cunliffe has dutifully come down to introduce the Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill. 
I repeat the statements made by Pansy Wong. I can assure the House that the National Party will vote against this bill because it cements in place for yet another year the highest tax rates in the South Pacific and Asian regions. New Zealand has the highest tax rates of any country with which we trade. David Benson-Pope shakes his head in amazement. He is another recently appointed Minister and he did not realise that this— 
Brian Connell 
: A short-term appointment. 
Hon DAVID CARTER 
: A very short-term appointment. He is acknowledging today in the House that he did not realise— 
Hon David Benson-Pope 
: Tell the whole story. 
Hon DAVID CARTER 
: Now he is telling me to tell the whole story and I am happy to. I will ask for an extension of time to carry on telling the whole story. The whole story is that this bill cements in place the highest tax rates of any country in the South Pacific and South-east Asian regions. That is the whole story. That is why countries like Australia can regularly perform over a period of time at a higher growth rate than New Zealand. The average weekly pay packet of Australians as opposed to New Zealanders has approximately $200 more in it because they do not have to pay crippling tax rates that stifle the economy. 
Let us look at the highest tax rate of all—the personal tax rate of 39c. 
Brian Connell 
: That’s a killer. 
Hon DAVID CARTER 
: My colleague Brian Connell is absolutely right. It is an absolute envy tax. I recall that the Labour Party campaigned on the tax with two messages. Firstly it said that it would affect only 5 percent of taxpayers and it is now being paid by nearly twice that many—about 10 percent of taxpayers. But the other thing Michael Cullen David Cunliffe and Darren Hughes campaigned on was that they would apply this extremely high tax rate only to the wealthy. That is what they said—it is only for the wealthy. Then we find out—and it is being re-cemented in this legislation today—that their idea of wealth is someone who earns $60000 a year. 
David Cunliffe nods his head and says yes that is a wealthy person in New Zealand. If that is his level of aspiration for this country it is no wonder that the public of New Zealand have finally woken up to this Government. Sixty thousand dollars is not wealthy. It equates to close to the support wage that the Americans pay. [ 
Interruption 
] It is effectively the poverty line in the United States and because of its lack of ambition for this country it is recognised by the Labour Party as a wealthy position to be in. I say to that Government that if it thinks $60000 is wealthy and the sort of wage at which people should be asked to pay 39c in the dollar tax it is too high. 
The other thing I want to move on to in the bill is a section that again David Cunliffe did not make mention of. The rates in schedule 1 vary from the rates that applied for the 2003-04 income year in the following way: a rate of 19.5 percent will apply to Maori authorities. 
Brian Connell 
: That can’t be right. 
Hon DAVID CARTER 
: That is what this legislation does. It reinforces a special rate for Maori authorities that is just impossible to justify. I have heard Dr Cullen come into the House and attempt to justify it. His rationale goes something like this: the beneficiaries of Maori authorities tend to be lower-income New Zealanders and on that basis the Government will make those authorities pay 19.5c. The ma and pa investors in Air New Zealand will on the whole be low-income New Zealanders. They will be paying tax rates of around 21c so why not apply the same logic to them? Darren Hughes does not have an answer to that because there is no answer. This law gives a special tax rate to the Maoris. No one can argue against that. 
Darren Hughes 
: No that’s not right. 
Hon DAVID CARTER 
: I invite Darren Hughes to take the next call having read the bill. It is in black and white Part 1 cementing in a tax rate of 19.5 percent for Maori authorities. Darren Hughes cannot deny that. 
My time is running out. This bill means that on Monday and Tuesday people work for Dr Cullen and the Government; on Wednesday they work to pay GST and local government rates; on Thursday and Friday they start earning for themselves and then have the ability to buy their cars fuel their cars feed their families and pay other bills. If Darren Hughes thinks that is not a high tax rate I ask him to take some time out and look at the successful economies in the world. They are not stifled with tax rates like this. 
Darren Hughes 
: They have higher tax rates to pay. 
Hon DAVID CARTER 
: They do not have higher tax rates at all and Darren Hughes knows that. He knows that New Zealand is a high-tax economy and that is why people in this country get fed up with seeing money going into Government coffers and then being spent on things like a $26000 hip-hop tour.