Labour ministers’ enthusiasm for a capital gains tax appears to be waning by the day. Even the PM, Jacinda Ardern, no longer seems to be talking up the need to make the tax system “fairer” by bringing in a comprehensive CGT.
Revenue Minister Stuart Nash went so far as to say this week “there is nothing to consult on”.
Here is what he told Parliament on Thursday:
Nash: When I said I’m not consulting on a capital gains tax, I’m also not consulting on the 19 measures that the Tax Working Group considers would reduce compliance cost to small to medium enterprises.
Gerry Brownlee: Why not”?
NASH: Because—can I say this again—there have been absolutely no decisions made on this, so why would I formally consult when there’s absolutely nothing to consult on?”
Then there is the Minister of Agriculture Damien O’Connor, who told the NZ Herald in an interview published last Saturday he had not read the whole report of the Tax Working Group.
This prompted a tart comment from National MP David Carter in the general debate in Parliament on Wednesday:
“What I found extraordinary is Damien O’Connor’s comment in the NZ Herald that as of this day, he has not read the Tax Working Group’s report to know the effect it’ll have on agriculture. That is just extraordinary, that he can claim to represent NZ farmers and he hasn’t bothered to read the report that advocates for a capital gains tax, advocates for a nitrogen tax, advocates for a water tax, advocates for an emissions tax, and, finally, advocates for a fertiliser tax. What effect will all of those taxes have on NZ agriculture? He doesn’t know, and what’s worse is the Labour Party doesn’t know”.
Carter had another insightful anecdote for Parliament:
“I heard an extraordinary story about a particular stand at the Wānaka show over the last weekend. Mark Patterson, that little-known NZ First member from somewhere down that end of the world—he had a stand, and he put out a sign in front of his stand saying, ‘Come and tell us what NZ First should do about the capital gains tax.’ It had a queue longer than the Ferris wheel’s. There was such a big queue of people in the Wānaka show wanting to tell Mark Patterson what to do with the capital gains tax. Do you know what his response was? He took the sign down and shut up the tent. That’s how embarrassed he was”.
Point of Order thinks there’s a job ahead for Sir Michael Cullen ( who is still being paid $1000 a day for any work he does on the TWG report). He could give each minister a full briefing on his report.
Finance Minister Grant Roberston told Parliament in another question time exchange:
I believe it is appropriate for Sir Michael Cullen, as the chair of the Tax Working Group, to explain the recommendations of that working group while the matter is under consideration by the government. If, as part of those explanations, he is required to correct misrepresentations and lies, that is the role he has”.
And here is another illuminating passage on Sir Michael’s $1000-a-day value:
Amy Adams: “Does it count as explaining the recommendations for Sir Michael Cullen to make statements describing the Opposition, and I quote, as ‘salivating like a bunch of guard Alsatians from the German army in World War II’, and isn’t that simply a political attack being funded from taxpayers’ dollars?
Grant Robertson: Sir Michael Cullen is responsible for the words that he uses. A phrase does come to mind: “If the shoe fits”.
Adams: Why is he so cavalier about paying a former Labour Minister $1,000 a day to undertake clearly political attacks?
Robertson: I am not being cavalier about this. The pay rate that Sir Michael Cullen has is based on the Group 4, Level 1 body rate under the Cabinet fees framework.
Adams: Why is the Minister using taxpayer funds to pay Michael Cullen $1,000 a day to do, and I quote, ‘favours for the government’, as Willie Jackson stated in Parliament yesterday?
Robertson: I don’t believe that’s a fair characterisation of what was a very full and rich speech by Jackson.
Point of Order can’t help wondering if ministers have fully grasped how the CGT issue is now eroding the political impact of the government’s own economic plan.
Perhaps some of them are pinning their hopes on Winston Peters targeting the CGT with his own torpedo.