Ardern Shane: Taxation (Base Maintenance  and Miscellaneous Provisions) Bill — Second Reading Instruction to Committee In Committee 
Ardern Shane: Taxation (Base Maintenance  and Miscellaneous Provisions) Bill — Second Reading Instruction to Committee In Committee 
[Volume:626;Page:21453] 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 It was interesting to hear the last speaker correctly announce that even the Green Party is in favour of tax reduction. We are here tonight debating the Taxation (Base Maintenance and Miscellaneous Provisions) Bill. It is yet another complex pile of bureaucratic socialist engineering to try to outwit clever lawyers accountants and tax people when all of it is unnecessary. One simple question that has been put tonight is yet to be answered. This question has been put many times over the last couple of sittings of Parliament and is yet to be answered: why not avoid it all by just lowering the tax rate and taking out the incentive for those who invest so heavily in trying to get around the New Zealand tax system? Why is that question not answered? The reason is quite simple. It is that the Labour Party and all socialist parties fundamentally disagree that one can lower the tax rate and still provide basic services at the level people have come to expect. 
Yet all the evidence in New Zealand from our own experiment back in the 1980s was that when the tax rate was lowered the actual tax revenue went up. I see a former Minister from that period in the Chamber and I am sure that he will agree with me. 
Hon Richard Prebble 
: That’s right. 
SHANE ARDERN 
: That is exactly what happened. The members on the Government side of the Chamber—and I see a couple of current Ministers having a little conversation in the back—should pause for a moment and listen to this because clearly it is news that has never ever made it to their ears. It is just too logical for them to understand it—too simple. When the tax rate was lowered in the 1980s tax revenue went up. More tax was paid. Far less was spent on consultants. There was far less need for this kind of bureaucratic nonsense to try to stop those who would use various tax loopholes—tax provisions is probably a more accurate way to describe them—to get around the taxation system. 
Here in the New Zealand Parliament tonight we face a situation that is absolutely unique. Never before in the history of New Zealand have we had a situation like this. That is we have surpluses that are higher than ever before in this country no matter how we measure them. Whether we measure them on a per capita basis or on an export dollar basis—whatever measurement we use—at the moment this socialist Government enjoys the highest surpluses New Zealand has ever seen. Yet at this stage with those revelations—and clearly they must be revelations to the Government—and in these circumstances the Government still cannot see its way clear to having a lower tax rate for all New Zealanders in particular for those they purport to represent. That is the most perplexing thing. The Government purports to represent hard-working ordinary mums and dads yet it is that group that the Government is so disadvantaging through its taxation policy. I say to the Committee that I cannot understand for one moment why the Government will not listen to that kind of simple logic when the evidence is overwhelming that lowering taxes will work and has worked before. 
I would like to talk tonight about a number of other areas of income tax. One of them is the whole notion that if a company is growing and prospering then the State should take a bigger chunk of its profits and have a bigger say in how it operates. Effectively that is what happens. Through passing copious piles of regulation and legislation such as the bill we have before us that is exactly what the Government does. The Minister of Finance effectively says to those companies that he is much better at advising them on what they should do with regard to the management of their businesses than they are. He has no track record to prove it. No Government in this country has ever had a track record to prove it. But despite all the evidence the Minister of Finance believes that he and his advisers are in a better position to tell companies how to run their businesses than they are. So what the Government says is that it will take a higher percentage of their income.