Dyson Ruth: Taxation (Urgent Measures and Annual Rates) Bill — In Committee Third Reading 
Dyson Ruth: Taxation (Urgent Measures and Annual Rates) Bill — In Committee Third Reading 
[Volume:651;Page:221] 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 It is clear that when that member David Bennett makes his contribution in the House he has a soundtrack to a movie playing in his head. There could not have been more clichés packed into a 5-minute contribution than that member just demonstrated. I am assured that every National Party MP has been offered a dollar for every time he or she says “a brighter future” in the House. David Bennett will retire rich. That was an awful contribution if I may say so even by comparison with previous ones. 
I would like to make two points during my contribution to debate on Part 3 of the Taxation (Urgent Measures and Annual Rates) Bill. The first is to ask the Minister sitting in the chair some specific questions about what is clearly a misunderstanding on the bill. I was able to pose these questions to the Minister of Finance earlier. Unfortunately he was called away from the Chamber on urgent matters of public affair; he had to leave and was not able to give me an answer. So I ask the Minister in the chair the Hon Dr Jonathan Coleman to provide on public record the answers to these questions. His colleagues clearly do not know. 
Over the dinner break I witnessed another one of the new bewildered backbenchers of the National Government asking a senior colleague whether what Labour was saying was true; whether it was true that we are increasing taxes for low-income earners. That bewildered backbencher was told to just ignore what Labour is saying. [ 
Interruption 
] In my view that is a totally dishonest way of proceeding with any legislation let alone legislation that is being rammed through under urgency without any public input let alone public scrutiny. 
I ask the Minister in the chair what is—under existing law—the 20/11 marginal tax rate for a person who is earning between $14000 and $20000 a year? Does the Minister know the answer to that question; if so is he prepared to answer by interjection? Right. He probably does not know; I will help him. The answer is 12.5c. That is the current 20/11 marginal tax rate for a person earning between $14000 and $20000 a year. Under the bill that we are debating under urgency tonight what will be that same person’s marginal tax rate? The answer is 21c. I ask the Minister what is higher—21c or 12.5c? In my view increasing a person’s marginal tax rate from 12.5 percent to 21 percent is raising his or her tax rate. A person earning between $14000 and $20000 a year does not have excessive amounts of money to splash around. There is not much left over every week. So the Minister needs to say that either it is a typing or drafting mistake—and that is possible as it may well have been put together in a bit of a hurry—or that what Labour is saying is right and that what the Minister of Finance and his Acting Minister is saying is incorrect. This bill increases the tax rate for the lowest-income earners in our country and every member of the National Party who said that they would cut taxes for every single New Zealander should go back to where he or she campaigned and apologise to the public of New Zealand. 
If National members do not do that we will make sure that every single person who heard that dishonest commitment knows what actually happened during the process of this bill. It is just plain dishonest to say prior to the election that every single working New Zealander will benefit from tax cuts to make that commitment to the country and then come into this House and raise the tax rate of the most vulnerable people in our community. 
The second point I want to raise is in regard to the amendment that has been presented by Michael Cullen an amendment to insert a new clause 30A. The point of this amendment is quite simple and is explained as is appropriate in the explanatory note. It says that this amendment “will ensure nobody is made worse off as a result of the new rate and threshold changes.” It could not be more straightforward as outlined in that explanatory note. This “will ensure nobody is made worse off as a result of the new rate and threshold changes.” What National member would disagree with that? What National member would say that this only confirms what John Key said all through the campaign? It only confirms what Bill English said all through the campaign—“Nobody will be worse off in fact everybody will be better off.” In fact this amendment should confirm National’s commitment. But what has happened to it? What has happened to this amendment? 
I will leave the answer to that question for just a little moment because I want to quote what the Minister of Finance said during one of his earlier contributions in this debate tonight. On record in the House—recorded extraordinarily accurately by the Hansard stenographer and the tape—he specifically said: “There are no losers under this bill.” That to my mind means that nobody will be worse off. They may not be better off—I will accept that. But “no losers” means they cannot be worse off. He said: “There are no losers under this bill.” So if that is true if what the Minister of Finance said in this very debate in the Committee is true this amendment would get the total agreement of Parliament. [ 
Interruption 
] Sorry; with the exception of ACT members who may vote differently just because they are so inclined every thinking member of Parliament would support this amendment because it does nothing more than confirm what the Minister of Finance said. He said there were no losers so if this amendment confirms specifically in the legislation that there are no losers then it must be at no cost because the Minister of Finance has already confirmed it. Yet that same Minister of Finance has used an extraordinary process a financial veto on this amendment saying that it would cost $730 million over 5 years. Now how does that figure? I think even David Bennett might be able to work out that if there are no losers then an amendment to confirm that there are no losers cannot cost $730 million over 5 years. So where is that money? 
Hon Dr Michael Cullen 
: Unfortunately his teachers never told his parents anything. 
Hon RUTH DYSON 
: That is right. He probably did not have a literacy and numeracy test at 5 years of age. His parents never had his standards explained to them in plain English and that is why we have ended up with the situation that we have. If there are no losers under this bill then there is no way that Michael Cullen’s amendment can cost $730 million over 5 years but that is what the Minister of Finance has said. 
Where is that money now? We know that that money is in the wage packets of the lowest-income earners of New Zealand—the people who have either already had their tax reduced or who under the existing legislation are to have their tax rates cut over the coming 3 years. That is where that money either is going or would be going. For example the law as it is currently gives those people whom I mentioned earlier—the people earning between $14000 and $20000—a marginal tax rate of 12.5 percent. They are to lose that marginal tax rate and they will instead be paying over 20 percent. That is a loss. That is a tax increase. Bill English has confirmed in the House during this debate that keeping this bill honest to National’s commitment that there will be no losers would cost $730 million over 5 years. Well in my view it is now quite clear that it will cost a lot more than that to keep National honest. On this one bill we have had an absolute contradiction which was confirmed in the debate.