Jones Shane: Questions for Oral Answer — Questions to Ministers 
Jones Shane: Questions for Oral Answer — Questions to Ministers 
[Volume:637;Page:7825] 
3.  
SHANE JONES (Labour) 
 to the  
Minister of Finance 
: What reports has he received on how New Zealand ranks in the OECD for personal taxation on the average family? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I am sure the member will be encouraged to continue asking such brilliant questions by the applause from members opposite. I am not sure they will welcome the answer quite as much. I received a report  
Taxing Wages 
Report 2006 
 from the OECD which shows that for a single-income family with two children on the average full-time wage New Zealand has the second-lowest tax wedge in the OECD at 2.9 percent compared with the OECD average of 27.5 percent. 
Shane Jones 
: Is the Government introducing any changes that will affect the tax wedge on average families? 
Hon Dr MICHAEL CULLEN 
: Indeed we are. In just exactly 1 month the Working for Families tax credits will be extended by $10 per week per child across the board. That will reduce the tax— 
Hon Dr Nick Smith 
: More welfare! 
Hon Dr MICHAEL CULLEN 
: Ah “More welfare!” says the member Dr Nick Smith. I invite him to go and tell that to the families who will be receiving it. That will reduce the tax wedge for an average family to close to zero. It will play a significant role in reducing child poverty and that tax relief like the tax cuts on savings and investments passed last year is opposed by the National Party. 
Hon Bill English 
: Can the Minister recall the Government committing itself some years ago to lifting the incomes of New Zealand families into the top half of those in the OECD and can he confirm that the reason he stopped talking about that goal is that they were was slipping back not rising? 
Hon Dr MICHAEL CULLEN 
: Yes the Government has committed itself over the long term to be in the top half of the OECD in terms of per capita GDP. However it is not the only measure that this Government has because of course one could be in the top half by having a very small number of extremely wealthy people and a lot of poor people—what some people have discovered is called an underclass in technical language. This Government also believes in making sure that the average Kiwi battler family is better treated comparatively than similar families even in Australia—which the National Party opposed at every point. 
Gordon Copeland 
: Is the Minister aware that income splitting would further reduce personal taxation especially for average single-income families; if so should the New Zealand Government not follow the lead of the Canadian Government which may introduce income splitting as early as this year’s Budget on 19 March? 
Hon Dr MICHAEL CULLEN 
: There is to be a discussion about that matter before the next election—and indeed a discussion document that Mr Dunne and I will be working on. I do have to point out that now for the average single-income family with two children the net tax owing is almost zero after Working for Families is taken into account. It is hard by splitting incomes to get much below that level. 
Heather Roy 
: What will the Government do to restore Kiwis’ trust in Parliament and the public service given that the OECD report  
Society at a Glance 
 showed that the level of trust in this Parliament ranks third from the bottom of that in the OECD countries ahead of only that in South Korea and the Czech Republic? 
Hon Dr MICHAEL CULLEN 
: I thank the member for that patsy question. That survey was taken in the years 1994 to 1999 when a National Government was in office. 
Gordon Copeland 
: I seek the leave of the House to table a document that shows that according to polls income splitting is supported by 77 percent of all Canadians. 
Document by leave laid on the Table of the House. 
Gordon Copeland 
: I seek the leave of the House to table a document that quotes the Finance Minister of Canada as saying that income splitting is an item on the table for Canada’s 19 March Budget. 
Document by leave laid on the Table of the House.