Bridges SimonHon SIMON BRIDGES (National—Tauranga): It's great to speak on my member's bill. This is the first member's bill I have ever had in 13 years get to this stage of the process. I regret I wasn't here for my 10-minute speech. I am going to try and give one now in five minutes. I want to say just one thing to the member that's just spoken. She talked a lot about people earning $400000 a year—the fat cats on $400000 a year. They pay $136000 in income tax every single year. That's a lot of money.This bill is about what's called bracket creep. It's been inevitable in recent decades that over time income earners most of us actually—hard workers nurses truck drivers and the like—have moved inevitably unavoidably into a higher tax bracket and therefore pay more tax: that 10.5 percent to $14000; the 17.5 percent from $14000 to $48000 where 1.8 million people reside; to 30 percent for the $48000 to $70000 bracket. That's 700000 people who'd benefit from this law. And then 33 percent; that's for $70000 to $180000. That is 859000 people. That's not just some fat cats; that's a lot of ordinary New Zealanders paying their mortgage who would benefit from that.What's wrong with this increase in tax over time when people are as some of the members have said earning more? Well as incomes have gone up so has the cost of living: rent petrol electricity food—that Consumers Price Index (CPI) basket of goods that the member over there talked about. And by the way it's going up by—what is it?—3 4 percent at the moment; the highest in a very long time. So people are paying more tax and in real terms they have less disposable income to help their families with. And the Government's tax take their big sack of money Grant Robertson's big sack of money grows and grows and grows as the Government has more and income earners who pay tax have less. In that regard you might want to say that actually what this bill is really about—in addition to bracket creep because it's certainly about that—is cost of living. Rents are rising at the moment petrol costs are rising at the moment electricity is rising at the moment and food costs are rising at the moment. In terms of the specifics of this bill I just want to make a small number of points. It amends the Income Tax Act 2007. It provides for a review. There's been a lot of nonsense spoken over on that side about what this bill does. It only provides for a review by Inland Revenue's commissioner every three years within 12 months of a general election [to] review all specified dollar ranges to determine if they should be adjusted to reflect movement in the … [CPI] in the period since the specified policy changes were last reviewed."The other significant clause provides that if the commissioner concludes that the specified dollar changes should be adjusted in terms of CPI and the like they are under the regulations. But significantly—and this is why actually the bill is fiscally neutral—"Despite … [that] the Minister may decline to recommend that regulations be made … and if so the Minister must present to the House … a report that explains their reasons for declining".A few things flow from this. Well in 2019 when National first proposed this the calculations in relation to the specified dollar ranges assuming a couple of percent inflation meant income earners would be better off $400 then the next time $900 then $1400 with each adjustment. And if we don't do that by 2023 the average wage earner will have slipped into the 33 percent—second to top now under the Labour Government—tax bracket.The final point I want to make is that a lot has been made by the speaker over there—the member for Ōhāriu made the point about the fiscal costs of this and what it means for the Government. Well actually in 2019 terms—it will be more now—it was about $650 million in foregone revenue for the Government. That said I would argue it's not properly considered foregone revenue but rather stemming the growth of tax by stealth to Grant Robertson and the tax man. The Inland Revenue's coffers have been steadily growing as a result of bracket creep for the last several decades actually and this merely stems that tax increase by stealth as I say to Grant Robertson. He's worried about the loss of revenue. He should be more worried about the loss of revenue to income earners to everyday Kiwis who voted for him at the last election. But actually if they think about issues like this and how much harder it's getting in an inflationary environment I wonder if they will the next time.In conclusion this bill deals with bracket creep. It deals with the cost of living and it stops those tax increases by stealth by Grant Robertson."