A pre-emptive congratulations to our responsible Finance Minister

by Jake Quinn

Next predication, not that one needs to be a brain surgeon to work this one out, the Govt will put the kybosh on at least one of the two next rounds of tax cuts and what remains will be linked to a ‘not too much worsening’ economy. Good. That is sound conservative economic management in a recession. Exactly what National Party voters voted for.

Finance Minister Bill English announced today that “personal income tax cuts planned for 2010 and 2011 would only go ahead only if affordable.” Labour leader Phil Goff should be weary of attacking the Govt with the line “Nats renege of pre-election tax cut promise” which, if my hearing of Radio NZ National this evening was correct, is exactly what he is doing.

Bill English is as aware as the next joker that Kiwi’s don’t want tax cuts if they are borrowing from their children’s and grandchildren’s future (or their own super) to fund them. He will have read the recent New Zealand Business Council for Sustainable Development survey that concludes “New Zealanders’ overwhelmingly say they don’t want the Government to go ahead with the next round of personal income tax cuts if it involves further borrowing”. He may have even done some polling to back this finding up, which, I might add, would have been a waste of money as the NZBCSD’s methods are rigorous and sample sizes are solid (the ShapeNZ survey of 2569 people is two and half times the sample of the average political poll in NZ).

Labour will look loony if the try and turn this into a negative for National. The entire country is looking at their Household finances and looking for cutbacks. This time is different, when Cullen scrapped the chewing gum tax cuts in 2005 it was a tax cut adverse Labour Finance Minister getting rid of a rare tax cut, something the public were hungry for at the time. Now, after two rounds of significant tax cuts in the last year, it’s a National tax cut loving Finance Minister responsibly putting on hold something the country can’t afford. Any sane person will respect that and so should Labour.