Cunliffe David: Taxation (Annual Rates Maori Organisations Taxpayer Compliance and Miscellaneous Provisions) Bill — Second Reading 
Cunliffe David: Taxation (Annual Rates Maori Organisations Taxpayer Compliance and Miscellaneous Provisions) Bill — Second Reading 
[Volume:606;Page:3931] 
DAVID CUNLIFFE (NZ Labour—New Lynn) 
: 
 I am pleased to support this bill particularly as it applies to the taxation of Maori authorities. The first point to be reiterated is that there is nothing special and nothing new about special tax treatment for organisations that face special constraints. In this case Maori authorities are distinguished because they manage assets that are communally owned. It is not possible for the authorities to dispose of those assets and for that reason amongst others they are given tax treatment appropriate to that class of assets. They are not however singled out on the basis of race. This is a bill that tries to fairly represent the tax position of the overwhelming number—about 90 percent—of the beneficiaries of those Maori authorities. It is therefore absolutely correct and absolutely appropriate. 
It is worth reiterating that there is absolutely nothing new about this type of provision. It has been in existence since 1939. Indeed the last revision was in the 1950s and it has carried on under both National and Labour. The difference is that we are upfront about supporting it and modernising it to reduce compliance costs. Every time that happens the Opposition trots out the old race card. I was surprised because it really is not worthy of what we would expect of the Opposition’s new spokesperson on finance. I would like to spend a moment or two on his contribution. 
First off he did fairly represent the bill in one respect when he said: “There is much in the bill that is plain common sense.” Indeed that is true. There is much in the bill that is taxpayer friendly. It increases the maximum amount people can claim as a tax rebate for donations it broadens the definition of “good behaviour” that can be taken into account when imposing shortfall penalties it allows business to pool provisional tax payments with those of other businesses thus reducing their exposure to use of money interest it allows for the use of intermediaries for PAYE and so on and so forth. These are simple common-sense measures designed to reduce compliance costs and the tax burden on ordinary New Zealanders and their businesses. 
Dr Brash could not help himself though; he leapt back to the future as he seems to be in the habit of doing and argued that this bill should have been used to drop the top tax rate. Of course he failed to mention that it was a previous Labour Government that dropped the top tax rate down from 66 percent; 39 percent is quite reasonable. Where he really departed from reality was when he trotted out that old argument from the Reagan days. It is called the Laffer curve in the economic jargon. It says that because rich people already pay a lot of tax if they are given a tax cut they will end up paying more tax. It is a kind of circular logic. The trouble is it has never worked. In the history of economics it has never been proven and I warrant that it would not work in New Zealand either. 
It is a funny thing that has come over Dr Brash. When he was the Governor of the Reserve Bank he used to call Dr Cullen “fiscally prudent” but now he calls him “miserable”. I suppose it is the same thing. It means that he does not spend everything that he gets in tax receipts. Indeed that is true. The Government has been very prudent and we have taken a prudent approach to paying off debt and managing expenditure. That is what I cannot understand about the National-ACT argument about tax policy. On the one hand they want to cut taxes but on the other hand they want to pay off even more debt. We cannot do both of those things and still fund schools and hospitals. Something has to give especially when we have people like Dr Wayne Mapp running around and wanting to buy more frigates and strike aircraft. They just cannot have it all ways. The National Party is indulging in voodoo economics. It should know better. 
But all that pales into insignificance compared with our old friend Rodney Hide. We have come to enjoy his jovial banter in the House and he has been doing rather a lot of that lately as he continues his ongoing tour of tax havens in islands around the Pacific and the Hauraki Gulf. He comes from a party that is very familiar with wholly-owned Maori subsidiaries. ACT seems to have one of its own at the moment. The only difference is that it does not want to keep it and Donna Awatere-Huata wants to stay. 
Taking tax advice from the ACT party is something that even its own parliamentary staff are finding perilous. I suppose it is a bit like taking investment advice from Dolf de Roos on a Fiji island. Rodney Hide criticised the 39 percent tax rate as being too high and again made the mistake of ignoring that it was Labour that dropped it last time. He asked why Maori authorities should get away with 19.5 percent tax—ignoring the plain fact that 90-plus percent of Maori qualify for 19.5 percent anyway because they earn less than $38000. 
On the one hand we have a Government that is trying to simplify tax and make it easier for ordinary New Zealanders to meet their obligations. On the other hand we have an Opposition that seems to be split between going “back to the future” into voodoo economics that have never worked as Dr Brash is doing and indulging in a tour of Pacific tax havens as Mr Hide is doing. Neither of those add up. This bill is good policy it is good ethics it is fair and it reduces compliance costs. I am proud to support it.