Matisyahu's Blog

If you’ve been following the election so far there are the usual suspects whipping the population into hysteria about how the whole system is going to collapse in on itself due to Labour’s free spending ways (link) (link) – put ‘nz increase public debt’ into Google News and see the avalanche of doom and gloom stories while ignoring that a) We’re seeing the consequences of the world ignoring climate change resulting in severe weather resulting in massive payouts on homes that have been destroyed or damaged by recent weather events b) The cost of building infrastructure caused by inflation which comes back to the lack of skilled workers and specialists not just locally but globally. Long story short, unless we deal with those issues we’re going to keep finding that it’ll be difficult to address the challenges in the future.

The other big announcement has been National’s tax policy (link) where on the surface it would greatly benefit me – the adjustment to the IETC along with the brackets being adjusted inline with inflation which works out to be roughly around $27 per week. Sounds great? yeah, that’s until you start reading the ‘fine print’ regarding how they will cover the shortfall in revenue. I can’t exhaustively go through all of what they’ve proposed but here are a few of them:

a) The tax on overseas operators isn’t as high as what they claim – as part of the Entain/TAB agreement TAB will have a monopoly in New Zealand in much the same way that Australians cannot bet with overseas bookies. If we take the money being spent right now on overseas bookies then all that is left is a very small number of people who bet with online casinos, poker, black jack etc. which is going to be nowhere near what National forecast.

b) The 15% tax on foreign buyers of homes over $2 million sound great until you realise that you’ll find developers will schew their property development to the high end segment of the market which will have the highest profit margins. The idea that it won’t have an impact on housing that the domestic market is demanding is a bit laughable – no matter how good the ring fencing is there will always be some sort of unintended consequences that come as a result no matter how well the policy is designed.

c) Cutting public transport subsidies and investment which will impact many New Zealand families who are already struggling not to mention the reduction in investment impacting the reliability and future investments that’ll make public transport more efficient in the future. I suggest people look back to the 1970s when the National Party reversed the investments the Labour government were making into mass transit – it took until 20 February 2011 for the rail line up to Waikanae to be electrified and that doesn’t even touch on the rejection of Mayor Robbie’s mass transit plan for Auckland (link) and now Auckland today are dealing with the consequences of rejecting the plan. There are costs – not just the upfront but the downstream costs, you may save $x upfront by not building something but end up paying more down the road because it hasn’t been built aka ‘penny wise but pound foolish’.

Here is a good video regarding the whole National tax policy from ‘Big Hairy News’ (show your support by buying some merch from their store, they make some of the best local content (link)):