Foss Craig: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
Foss Craig: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
[Volume:651;Page:141] 
CRAIG FOSS (National—Tukituki) 
: 
 I will take the liberties that the previous speaker took around a wide range of topics although he did eventually come back to Part 1. In speaking to Part 1 which is clauses 3 to 17 inclusive I draw the Committee’s attention to the title of Part 1 which is “Personal tax cuts”. Does that not sound great? Personal tax cuts—right here in this bill. 
Hon Dr Michael Cullen 
: Oh God! Don’t slobber. 
CRAIG FOSS 
: I will say it again for the member over there—personal tax cuts. I imagine that his first taxation bill said “personal tax hikes”. Is that what the member’s first tax bill said? Actually all the way through the last 9 years the member’s bills have probably said various things about threshold and fiscal drag etc. 
There are a couple of points in this part. OK the micro staff which members on the other side of the Chamber keep talking about—$2 here and $3 there—is relevant but what they keep missing and do not talk about which says much about the head space they are still in is the macro the vision the investment that this makes in New Zealand. The threshold changes in Part 1 actually are all about the biggest investment in the infrastructure of New Zealand—the people. It is saying to them: “We value your hard work. We value your staying hopefully in New Zealand and we value your investment in your education with your student loan and these tax threshold changes will enable you to pay your student loan off earlier and will offer you a higher more viable after-tax income.” I am yet to hear anything of that nature from members opposite rather the myopic vision they have of trying to justify things to each other in spite of their somewhat diminished majorities. 
Part 1 contains a pro-rata provision and explanations of it. As all members will acknowledge there are many complicated issues around all things related to taxation and this policy that the Government has introduced here was flagged very very early on. So there is much certainty out there and in fact members will see as they go through some of the detail in the bill how with the top marginal rate going down to 37 percent the banks can start to use resident withholding tax at 38c from 1 April next year because over the year the pro-rata will catch up. Most things will come out in the wash. 
Previous speakers have mentioned that these changes will mean that 80 percent of New Zealand taxpayers will be at or under the 20 percent rate. That is not too bad but why stop there? I was very interested in the speech made by the previous speaker who this morning was basically arguing for higher taxes. He started to refrain a bit and tried to justify that a bit further but his multiplier arguments were all over the show this morning. I guess he has gone out and googled the stuff in between speeches and realised what he was saying. What he was saying was that if this was his bill the rates would all be going up and the bill would be called the “Personal Tax Hikes Bill”—or at least this part of it would be. I look forward to debating and discussing further points in this bill. There will be some good and robust questions I am sure and the Minister in the chair is more than prepared to push further National’s vision and our ambition for personal tax cuts.