Why not cut tax today?

The Government could cut taxes today if it wanted, says ACT Leader David Seymour.

“Taxpayers shouldn’t be bribed and manipulated with the vague whiff of tax cuts. Instead, the Government should cut taxes now, then campaign in 2017 on its record, instead of just promises. There’s nothing in the law that forces the Government to wait for a Budget to cut taxes.

“The Prime Minister’s polling might make tax cuts look unpopular, but ACT believes that cutting tax is simply the right thing to do, regardless of the political situation. When people know they’re keeping more of what they earn, they excel in their careers and the whole economy ticks over more effectively.

“Even a small change would send a strong signal to taxpayers that their hard work is valued. The top tax rate (33%) kicks in at $70,000, but people earning $70,000 aren’t exactly rich. The top tax rate shouldn’t kick in until you earn $100,000. Making that change would cost less than $300 million – a small fraction of the $1.8 billion surplus.

“A more general idea is simply to split the surplus into one third tax cuts, one third debt repayment, and one third new spending. That’s a fiscal policy with something to please everyone.

“John Key should remember that Jenny Shipley promised tax cuts in 1999, but she never got a chance to implement them as she lost the election that year. Sometimes a tax cut in the hand is better than two in the bush.”

ENDS

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