A wasted opportunity
Last year’s surplus has been confirmed at $11.5 billion, indicating New Zealand missed a golden opportunity to reduce the taxation burden on New Zealanders.
Without even touching a cent of Government expenditure, the Government could have delivered multi-billion dollar tax cuts to taxpayers.
What this shows is that no matter how large the surplus, Labour will never deliver significant reductions in taxation, They see it as their money, not our money.
The more useful OBERAC surplus of $8.6 billion started life as a projected $3.854 billion surplus for 05/06 in the 2001 DEFU. The May 2004 budget said it would be $4.994 billion. At the start of the year in question it was projected to be $6.665 billion. And even just a few months ago in the 2006 budget it was forecast at $6.977 billion. It’s grown like a tumour – $1.7b in six to ten weeks from the budget in May to the end of the year at 30 June.
This reinforces my long held view that Treasury are far too conservative with their forecasting. It also indicates that any suggestion future tax cuts are unaffordable because of the relatively smaller forecasts over the next few years, should be ignored. The projected surpluses will double in size on average, plus they have a $2 billion per year slush fund included in them for new expenditure.
National has said that tax cuts will be incremental, and this is of course no different from the 2005 policy which was to be introduced over three or four years. But on today’s figures we should be talking about some pretty large increments – certainly much more than Labour’s 89c a week personal tax cuts.
October 11th, 2006 at 1:40 pm
8.6 billion reasons for the gummint to “pay it back”.
October 11th, 2006 at 1:41 pm
There will be tax cuts – just in time for the election.
Which I believe I predicted shortly after the last election.
October 11th, 2006 at 1:47 pm
OK, so who is going to support a flat $2,500 per person refund?
October 11th, 2006 at 1:59 pm
@probligo:
Probably labour, as long as it is “targetted”, and isn’t wasted on giving those filthy-rich $60k+ tax-payers any of their cash back….They don’t need it, because they’ve already got more than enough to buy super-yachts and third cars.
October 11th, 2006 at 2:11 pm
Getting rid of GST ($10.577 billion last year) should do the trick.
This government seems intent on rolling back the changes made during Roger Douglas’ reign so let’s see it.
October 11th, 2006 at 2:13 pm
Probligo:
don’t even think about $2,500. that means you are including the “money go round” taxpayers. what would the figure be if you only include those who generate “new” income? ie if you left out the taxpayers on a benefit.
and before sonic leaps in, can we please understand that a surplus is AFTER you have paid for all the useless extras that this govt loves to fund. you could give this money back without cutting anything anywhere!
October 11th, 2006 at 2:18 pm
Just more reasons for some of us to arrange our affairs so we only donate the percentage of our incomes to these wastrels and thieving bastards that WE believe is fair and equitable.And it may cause some of us to revise our donations downwards as a sign of disapproval of the behaviour of our employees.
October 11th, 2006 at 2:23 pm
This Government is hoarding money at the expense of ordinary NZers who can spend money far more responsibly than this Government. They would not be spending it on a whole lot of plastic cards with a fake photogrpah on it.
October 11th, 2006 at 2:28 pm
Hon Dr Cullen
Minister of Finance
Dear Dr Cullen,
I don’t blame for keeping the 11.5 Billion surplus. It’s called fiscal responsibility something that is lacking in the Brash/Hide camp. In my view those 2 cowboys Brash/Hide would have flogged off the entire surplus regardless of keeping some aside for a rainey day.
Good on you Dr Cullen keep the surplus and spend it on health and education when the time arises.
Most here are doing just fine I recall DPF complaining he had around $5.000 worth of coins laying around the house he couldn’t be bothered picking up, plus around $3.500 in overseas funds he didn’t know what to do with.
No Dr Cullen stick to your guns and don’t be fooled by shear greed of the… whats in it for me brigade, that surface on this blogg.
At your service
Cadmus
October 11th, 2006 at 2:35 pm
Cadmus, How much would you like to bet Labour will not reduce taxes? They definately will just before the election. How much thx cut is will depend on thier telephone polling.
October 11th, 2006 at 2:35 pm
Economically at the moment our biggest worry has to be inflation. Not really a prudent time to be splurging on tax cuts I’m afraid to say.
Tax cuts at the moment would just be clawed back by higher interest rates, but this may change (probably the budget before the election)
http://www.stuff.co.nz/stuff/0,2106,3824520a13,00.html
October 11th, 2006 at 2:36 pm
That’s “sheer” Cadmus.
and anyway, what IS in it for me?
October 11th, 2006 at 3:07 pm
Chuck, llew No, I don’t want a tax cut! I have already written to Dr Cullen saying keep the tax and put it into Health & the Working for families package.
And llew, there is plenty for you and others!
Working for families, student interest, Dr Visits, etc, plus what NZ1 & the Rt Hon Winston Peters have contibuted to the well being of NZers. Your have never had it as good! And there will be more to come in 2008!
It comes down to need not greed!
October 11th, 2006 at 3:28 pm
Join Cadmus in freeing your mind of all that tedious individuality and thinking! Celebrate Dear Leader Helen’s troika with Grand Vizier Cullen and the ‘Happy to be the (ex) Member for Tauranga.’ You can’t deny how New Zealand has advanced since their regime took power.
And the best news is that Dear Leader and her cronies are happy to do all the thinking for you! Their evaluation of your need, not your base personal greed, will determine how the Mighty State fulfils your measly prole requirements.
You can then simply stay at home, and pop out a sprog or apply for an emergency benefit whenever you feel like it.
Just sign away your souls by voting the politically-correct way, and upon formal confirmation from a commissar that you were spotted in a crowd of the fervent masses enthusiastically waving the Little Red Pledge card you will receive a special invitation to join the queues for dole yeast.
Ah Cadmus, if you weren’t such a mindless lickspittle spouting the party line with all the ferocity of the best brown-coated TUC official I’d actually think you were funny.
October 11th, 2006 at 3:36 pm
Gryfon you miss the point, there was a huge surplus at election time. Everyone new about it, and the still put their faith in Dr Cullen and a Labour & associates govt. The majority won get used to it!
You seem to forget the National Party are now against blowing the surplus, but again who could trust Don Brash…Well just ask his last 2 wives!
October 11th, 2006 at 3:45 pm
Cadmus: spend it on health and education when the time arises??
If not now, when?
This administration has been in office for nine years: a budget surplus of staggering proportions, taken at least in part from working New Zealanders on modest incomes, many of whom have health and education needs.
So when, according to you, is the right time to spend on health and education?
October 11th, 2006 at 4:14 pm
Sean you should know the right time to spend money is just before an election, the masses are ready to be bribed
October 11th, 2006 at 4:30 pm
“…and before sonic leaps in, can we please understand that a surplus is AFTER you have paid for all the useless extras that this govt loves to fund”…
AND BEFORE payment of all Capital Expenditure, and the annual contribution to the Cullen Fund.
So it will be used for (not exclusive list) such things as new P-class yachts for the Navy, SUV’s for the Army, the new AirForceOne, and getting more electricity into Auckland.
October 11th, 2006 at 6:05 pm
probligo;
IIRC, getting more electricity into auckland is the job of transpower. Unfortunately, the darlings at the commerce commision have taken the “how dare they make a profit” approach, regulated them and basically taken away the means for transpower to generate the funds it needs for further investment.
October 11th, 2006 at 7:55 pm
Oh Cadmus
You are a fool, NZ1 insisted on and got a tax cut, for racing.
Quoting the Rt. Hon. it was a meaningful tax cut that would benefit the entire economy.
Your lot (WP1) just can’t help themselves with U-turns and contradictions.
What next, coalition with ACT ?
October 11th, 2006 at 8:33 pm
Cadmus
Good to see you are so well connected with Cullen & Winnie so perhaps we can rely on you to persuadde them to fund DHB,s sufficiently to restore to the waiting lists those kicked off!!
October 11th, 2006 at 8:36 pm
Cadmus
Good to see you are so well connected with Cullen & Winnie so perhaps we can rely on you to persuadde them to fund DHB,s sufficiently to restore to the waiting lists those kicked off!!
October 12th, 2006 at 11:11 pm
…”a golden opportunity to reduce the taxation burden on New Zealanders”. My arse – “… a golden opportunity to reduce the taxation burden on those with high incomes that don’t need a cut”.
Spend it on schools and health Cullen and put some away for the aging baby boomers on this blog who will thank you for it in time.