In a night follows day kind of way, I note the warnings are already out there over the governments new tax regime.
Top earners, earners over $180 000, are facing a large tax increase probably in law by the end of the year. 33 to 39 cents in every dollar they earn.
The warning is be careful when you start to reorganise your finances to avoid it, and make no mistake plenty of people will.
This of course contrasts with Australia’s moves. As of next week their tax thresholds are changing and people actually get to keep their money and more of it.
And that’s before you get to the bit where they also have the first $18,000 or so tax free, so by the time you add it all up, it’s a better deal across the ditch, which is why in part, along with the generally higher wages we have got to be very, very wary of another brain drain at a time when we can least afford to lose anyone, far less the highly skilled.
Anyway, back to tax, the new top rate is justified because it only applies to two percent of earners and in that is another irony if not sadness.
The fact only two percent earn more than $180,000, merely proves what a poorly paid and generally poor country we are and that is nothing to be proud of.
One of the American states was looking to up their top tax rate above $250,000, and that would capture the top three percent, not two.
And further, not only doesn’t it capture many people it doesn’t therefore capture much money.
The Government claims $500 million. It will of course be nothing of the sort by the time the trusts and the companies have been set up, it’ll be well short, which then begs the question, why bother?
And the answer is, one, window dressing to make it look like they did something around tax to make them look transformative, the way they promised they would be.
The Labour Party Promotional consultants hard at work again making it look like Jacinda Adern actually does something for her $471,049 salary and free mansion!
And two, elitism, to make it in classic Labour style look like the so called worker is front and centre and those rich pricks can pick up the bill.
What this country so desperately needs is more success stories, more go getters, more highly paid, highly skilled winners, and less punitive thinking.
Clever government can create an environment which grows high value sectors and distributes income fairly by…
- Analysis of NZ to establish which sectors have the highest potential for returns (technology).
- Using the levers of Government which allow businesses in high return sectors to thrive while improving productivity, wages, and minimising adverse effects on the environment.