Dyson Ruth: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
Dyson Ruth: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
[Volume:651;Page:159] 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 Mr Chairman thank you for the opportunity to give my first contribution in this part of the debate. I am very keen to ask the Minister of Finance some questions and I am even keener for him to answer them. That is because I have been watching his National colleagues respond to our contribution on this Taxation (Urgent Measures and Annual Rates) Bill and it is very clear to me that National Party members and in particular Chris Tremain and John Hayes do not understand what is in the bill. Either they have not read it or had it explained to them or the printed version is different from the draft they were given. We know that the taxation policy of the National Party was released in October. That was not very long ago. I would have thought that before a bill came before this Committee the members of the party that is supporting it would have it explained to them. 
First of all I ask the Minister whether he has explained the bill to his colleagues. Do they know what is in it? Are they prepared to put their names to it fully aware that they are increasing taxes for the lowest-paid and most vulnerable people in our community? [ 
Interruption 
] The constituents of the Wairarapa should know that their member of Parliament John Hayes has confirmed that yes he is prepared to put his name to a bill that increases the marginal tax rate for the lowest-income earners in our country. 
I ask Mr English as the Minister to respond to this next question. Under existing law what is the 2011 marginal tax rate for a person who is earning between $14000 and $20000 a year? Mr English does not know the answer to that but the Hon Dr Michael Cullen has indicated he does so if he interjects— 
Hon Dr Michael Cullen 
: 12.5 percent. 
Hon RUTH DYSON 
: It is 12.5 percent. That is the answer to that question. That is currently the 2011 marginal tax rate in the existing law. Under the legislation that we are now debating in urgency which is a matter of critical importance because it increases the tax rate for the lowest-income earners in our country what will be the marginal tax rate for those same people? What—and it will be in force immediately upon the implementation of this legislation—is it proposed to be? 
One would think that the proposed rate might be lower than 12.5 percent because those people are the lowest-income earners in New Zealand. Well the answer is 21 percent. The current law is for the 2011 marginal tax rate to be 12.5 percent and the proposal is to put it up to 21 percent. I ask Mr Hayes which is higher: 12.5 or 21? The answer is that Bill English is proposing to this Parliament that the marginal tax rate for the lowest-income earners in New Zealand be increased from 12.5 percent to 21 percent and all the National Party backbench members should know that before they put their names to this legislation. ACT probably thinks that that rate is getting close to being about right. 
The Maori Party should know that its most vulnerable constituents the people who make the most effort to work fewer hours than the full-time cut-in for the amazing new independent earner tax credit are going to be penalised so that the chief executive of Telecom and the Prime Minister of New Zealand can get a lofty great tax cut. What is fair about that? What is progressive about that? How does that help any single individual or family let alone the New Zealand economy? The answer is that it does not. It takes us back to the division the poverty and the disempowerment that we saw Bill English preside over as chair of the Finance and Expenditure Committee during the bad old days with Ruth Richardson as Minister of Finance. During the election campaign people up and down the country said that National had said it would not go back to those days and it would not penalise the most vulnerable people in New Zealand. Less than 24 hours into the start of this Parliament we see promise after promise being broken by the incoming National Government. The most vulnerable people in our country are paying for that and we will make sure that they know exactly what the National members are doing.