Call for tax cuts to see off a recession

Susan Edmonds and Rebecca Stevenson write:

If New Zealand wants to make sure to stave off a recession, the answer isn’t with the official cash rate. It’s with . …

But if the Government really wants to pump up the economy and avoid the downturn that some predict is on the horizon, it does have options.
One of them would be to reduce taxes. The other would be to spend up large, and stimulate the economy through big projects. …

Tax cuts can be more effective than the OCR in several ways.
Lower-income people tend to spend the extra money they get, which then boosts businesses around them. 
They’re more likely, as economist Brad Olsen says, to choose to get pizza for dinner once every so often or to buy a present for the kids if they have a little more in their pay each week.

Very sound advice but this is a Government that hates allowing people to keep more of their own income. It would never do tax cuts.

Comments (70)

Login to comment or vote

Add a Comment

%d bloggers like this: