Key John: Questions for Oral Answer — Questions to Ministers 
Key John: Questions for Oral Answer — Questions to Ministers 
[Volume:626;Page:20794] 
3.  
JOHN KEY (National—Helensville) 
 to the  
Minister of Finance 
: What will be the weekly increase in after-tax income from 1 April 2008 for an individual earning under $38000 per annum as a result of the adjustments in tax thresholds announced by him in the Budget and what effect does he expect this increase to have on the economy? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Through the threshold change an extra 67c per week. 
John Key 
: Sorry? 
Hon Dr MICHAEL CULLEN 
: Yes for the member that would be sorry but for the person on $38000 per year with two children and rent of $300 a week with the Working for Families package that will come to $129.44 a week. As someone in this circumstance currently pays only $7410 a year in tax the 19.5 percent rate would have to be cut to 2 percent to deliver the same increase through the tax system. A tax cut of this size—roughly $10 billion a year—would be disastrous for both the economy and society but would make Mr Key and his mates very happy indeed. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. You have been very firm with the House about trying to get to the heart of the issue of Ministers answering questions appropriately. I do not want to trifle with you but perhaps it would be useful for the Minister to clarify that amongst all the plethora of numbers he just threw out there the actual answer was 67c. 
Hon Dr MICHAEL CULLEN 
: The numbers include all the changes that the Budget is paying for which for that family comes to $129.44 a week and for Mr Key comes to $10.24 a week. 
John Key 
: Was the 67c tax break the deep dark secret Labour Party president Mike Williams was touting before the Budget; and does the Minister think the president’s comments played a significant part in the Budget being so soundly rejected by all New Zealanders? 
Hon Dr MICHAEL CULLEN 
: No. I think that what happened was that certain print journalists interviewed their own typewriters decided there was going to be a big tax cut and as the poor benighted press gallery journalists must be earning a great deal more than I thought they earned got very disappointed when the tax cut did not appear. 
Gordon Copeland 
: Why did the Minister in wisely picking up on United Future’s call of a bracket adjustment for inflation defer its commencement to 1 April 2008 when by his own admission further inflation of about 6.12 percent will have occurred by then? 
Hon Dr MICHAEL CULLEN 
: The adjustment to thresholds is 3-yearly for administrative reasons. It starts from the start of the current tax year and therefore will come into force in 2008. I note of course that the National Party had tax cuts by Christmas that were gone by lunchtime. 
Dr Muriel Newman 
: What is the Minister’s response to those hard-working Kiwis who feel angry that a Government sitting on unprecedented surpluses has revealed that the so-called deep dark secret of the Budget is actually nothing more than a packet of Wrigley’s PK chewing gum a week in 3 years’ time? 
Hon Dr MICHAEL CULLEN 
: What that hard-working battling family will have if it is a low to modest income family is far more through Family Support changes than what tax cuts could ever deliver. It is only that party’s mates and funders who would gain significantly from tax cuts. That party is building expectations it cannot deliver on as we saw last week. 
John Key 
: In relation to the Minister’s first answer then does he agree with the Prime Minister that the  
New Zealand Herald  
put the words “deep dark secret” into Mike Williams’ mouth or does he agree that the tape of the interview shows Mr Williams stating unprompted that there was some deep dark secret in the Budget? 
Hon Dr MICHAEL CULLEN 
: If Mr Williams said that he forgot to tell me what it was. 
John Key 
: Oh—yeah right! That is a choice billboard—[ 
Interruption 
] 
Madam SPEAKER 
: I know it is the first day back but quiet please! 
John Key 
: If the Minister was not using Mike Williams as some sort of Amway salesman for tax cuts why did he not just come straight out and denounce the comments immediately after Mike Williams made them and well before the Budget was actually delivered? 
Hon Dr MICHAEL CULLEN 
: As I had no idea what deep dark secret was being referred to it was hard for me to do that without releasing the Budget. At least I did not promise tax cuts by Christmas and then back off from that within a matter of days as the National Party did. 
John Key 
: At what point did the Minister inform United Future members that the changes to tax thresholds would not take place until 2008; and were they grateful for those changes or did they react with a combination of laughter shock and disbelief—as the rest of the country did? 
Hon Dr MICHAEL CULLEN 
: If there is a mass outbreak of insanity and that member ever becomes Minister of Finance he will find that people are never grateful for what is in the Budget.