Back to the Future - Introducing The Current New Zealand Finance Minister
Labour have had a few finance spokespeople post the Roger Douglas era, yet if you count David Caygill only three actual Finance Ministers in the last 30 years. The latest we are lead to believe is Grant Robertson.
A preconceived committee was formed to soft-sell us into finding tax changes acceptable because Robertson effectively does not have the balls (as Douglas did) to present as his own the left-extreme left of the Labour Party's manifesto and make the changes with brutal speed. They created a Tax Working Group (TWG). We already know broadly what they will conclude so are left wondering what the hell is taking them so long?
Robertson and his left wing mates will have a list of what they would if they could do to the New Zealand tax system. I know this as it is the direct opposite of what myself and my right wing mates would have on our list. Tax policy is effectively a Finance Minister's cocaine that keeps their engine running. Why would you ever contract that out to someone else to sniff? Let alone to a committee?
The TWG will conclude but not agree that New Zealand needs the largest spectrum of changes since the last time Labour shook the tax system up. They will then present those and Labour will run more focus groups, shit themselves when they see the results - speed is the only thing necessary in change. Winston understands speed and the TWG is entirely playing into his hands. Speed is required to ensure he claims all the credit for moderating Cullen's proposed changes for his elderly cash poor, asset rich property and share owning supporters. He will take the profit when offered because he has more rat cunning than the entire Labour front bench.
Members of the Tax Working Group include:
Craig Elliffe - a now tax academic owned by the public service
Geof Nightingale - a PwC Partner who lauds correctly the lack of exemptions for GST but will probably support all manner of carve outs for CGT
Marjan van den Belt - a lady with a CV where it is clear there has never been a tax she didn't want to perform a hand held group brahmari in celebration over the introduction of. There is a single word I described people like this in my last incarnation however I shall resist.
Joanne Hodge - an otherwise completely competent former tax partner from Bell Gully who is ruining her reputation being involved in this process
Kirk Hope - a curiously attractive man who I saw out at the bar on Friday night (refer to my previous post)
Nick Malarao - a corporate undertaker, seriously why didn't they pick Stiassny?
Robin Oliver - a colourless man who has successfully sold the fact he is the only person boring enough to be an expert in areas so intricate in tax they don't need to be talked about. Oliver has never failed to find even the remotest public policy argument for opposing any brilliant otherwise law-abiding tax structuring whatsoever
Hinerangi Raumati-Tu'ua - CFO of Tainui Holdings (an income tax exempt entity) and yes the same Tainui that paid $12,000 in tax from a $137.8m profit so has probably never met a tax she didn't want "other people" to pay
Michelle Redington - an otherwise solid individual who represents corporate interests even if she works at Air NZ that we all know isn't entirely operating in a free market, last but by no means least we have
Bill Rosenberg - unionist. I can stop there with what I think of that appointment.
The problem for Labour and Grant Robertson was they chose any former Finance Minister let alone Michael Cullen to lead it. I say this is a problem as I ask what extent his role in the Labour Party and Government currently is in addition to this appointment? Brand Cullen will be all over it. This is his last hoorah. Except he no doubt will then be appointed to be on the committees overseeing the changes. The trough will as Celine Dion sings "go on and on". Cullen has a close relationship with my current favourite Labour MP Kiri Allan who surely must be the most competent brain in the Maori caucus, not to mention the most fun to watch, so in other words - is delightfully batshit crazy.
This editorial claimed that Cullen is not an independent tax expert. It was a tad pithy as none of the tax experts are actually independent. Those seeking to benefit the most from these wide sweeping changes proposed ARE the bloody tax experts. Every time I read of a proposed tax leaked I just think of how much money tax accountants are going to make. How do I know? I used to fucking be one. They cannot possibly be independent on a committee let alone the larger ones have contracts in Wellington they need to protect with the current government and possibly future ones.
As to what I think of CGT? Predominantly the largest issue I have with it is that Labour have campaigned against asset prices continuing to rise. The stockmarket in NZ and real estate market are at record levels. Can anyone see the problem?
The only way you gain income from CGT is if asset values continue to rise and at large rates. Are Labour's supporters, most of them who currently cannot afford their own homes, willing to back a tax that will only ever bring in revenue if those homes become even less affordable? It is a dichotomy most have completely missed.
The time to bring in a CGT is when asset values have tanked.
Which is why Cullen needs to step back and let Robertson take the reigns to the left. It is not going to happen while he still has such great influence and as Kane Williamson provides a "Steading of the Ship".
Take the training wheels off.
Because we are fair minded I shall offer my own thoughts what would bring in the most tax revenue and be politically saleable in the next posts.