Seymour DavidDAVID SEYMOUR (Leader—ACT): Thank you. Thank you very much Mr Chair. Dr Webb you shouldn't be disappointed. You might get an education in spite of yourself. Listen up. I just thought I should comment on Supplementary Order Paper (SOP) 2 and Andrew Bayly's amendments on that. I'm afraid to say that they're not quite as disappointing as the amendment he's put forward on Supplementary Order Paper 2 but nearly for a number of reasons. As Lord Keynes a beloved economist on the other side of the House once said When the facts change I change my mind. What do you do". I've actually changed my mind on indexation of tax thresholds. ACT advocated for them quite strongly in the 51st Parliament when of course the National Party had the Treasury benches and refused to do indexation presumably because when one holds the Treasury benches one is much less keen to erode revenue than they are when they're in Opposition. So I'd say to Mr Bayly that there was a good opportunity to do indexation. You had a very willing Government support partner with really quite a lot of pluck and alacrity and potential telling you that actually you should do it. Of course Mr Bayly's party didn't introduce indexation as he proposes now when it would have been much easier to do so.But actually I think it's for the better because as I said earlier we actually want broad based - low rate taxes. We want to have the same rate across all incomes so that we don't distort people's decisions. We don't want to continually hollow out the tax base by giving an exemption on some income necessitating tax rates on other incomes to be higher than they would otherwise be. In other words we don't want to keep raising the threshold for the bottom rate because that means we have to have higher tax rates on higher incomes. That's actually more distortionate. It's less fair because it means that people who earn more income don't just pay more tax because they earn more income; they pay disproportionately more. The more that tax thresholds are indexed to inflation the more of the effect I've just described you get.So these amendments on Supplementary Order Paper 2 are actually designed to give us a more progressive more distortionate more complex tax system than we would otherwise have. I'm glad that I didn't succeed in lobbying for tax bracket indexation all those years ago because having reflected and thought and read about tax policy over the years I've recognised that it's actually not a policy that will make New Zealand a fairer more meritocratic more prosperous country over time. It certainly sounds good a lot of policies sound good but this one won't actually work. But I would be concerned if I was to discover that the Minister's intention was that the Government was going to adopt this retrograde and not regressive but actually more progressive amendment. I hope that the Minister is going to say that the Government will vote against it along with ACT because we certainly don't want to be involved in anything that would make the tax system more progressive than it already is. And we certainly don't want to make it more complicated than it already is. We certainly don't want to move away from broad based - low rate taxes to narrow bases and higher tax rates and yet those are all the left-wing things that Andrew Bayly's amendment on the SOP does. I'd just be a little bit heartened especially given some of the pretty out there speeches I heard—particularly between 4.30 p.m. and 6 p.m. today—that the Labour Party is still the party that has some reference to economic orthodoxy and won't be supporting amendments to make the tax system even worse in terms of its progressivity. So I'd be very grateful to get an answer to that from the Minister. Being very grateful to hear that he's not going to support the amendment on SOP 1 which is certainly of the same ilk and takes us to a much greater level of progressivity and complexity in our tax system. Thank you."