Robertson won't rule out top tax rate hike

Grant Robertson (TV3)

Labour number three Grant Robertson has refused to rule out a top tax rate hike.

In repeated questioning during a debate with Russell Norman on TV3's The Nation, the economic development spokeman left his party wriggle room to back the Greens' plan for a new tax rate of 40% for those earning above $140,000. (see transcript below).

The current top tax rate is 33%, which kicks in for those earning more than $70,000.

The Greens say the increase would put another $1 billion in Crown coffers, which would be used to combat child poverty.

Commentators including the NZ Initiative's Bryce Wilkinson say top tax hikes and other "envy taxes" taxes hurt the poor.

Separately, Labour this afternoon pledged to scrap the current secondary tax regime for workers with more than one job.

Currently, those with more than one job often pay a higher rate on their secondary income but make it up if they claim a refund on the wash-up at the end of the financial year.

Labour says this is too complex, overpayments are often not claimed back and the system hits hardest those in casual work.

The party says it would wipe the current secondary tax regime within five years. 

National called Labour's new plan "desperate trickery". The party says there are already reforms "well underway" to deal with the issue.


RAW DATA: TV3/The Nation transcript: Patrick Gower interviews Grant Robertson and Russel Norman

Patrick Gower: Now, we’ve asked Judith Collins repeatedly to come on The Nation this week and sent the documents in full to her late yesterday. She’s declined our request for an interview, but along with her reply has sent us this email dated February the 5th 2013, showing her office prepared a reply on correspondence about the Binnie and Fisher reports a week before she released similar information to Cameron Slater. We’ve shown the documents to Green Party co-leader Russel Norman, welcome back, and Labour MP Grant Robertson joins us from Wellington. Good morning, Grant Robertson. Well, here we have it, guys, an email response – an OIA response in 37 minutes. Grant Robertson, what do you make of that?

Grant Robertson: Well, that’s pretty much unheard of, Patrick. It’s a good time for a pizza delivery –37 minutes – but you’d never expect that from an OIA. I’ve been at both ends of this process, both looking OIAs going out and requesting them. This looks like favourable treatment for someone, and it fits into a pattern of behaviour that we’ve seen from Judith Collins with relation to Cameron Slater. Friday night having a request processed, it just doesn’t happen.

But at the same time, his request did coincide with other requests. I mean, surely, perhaps it was just a coincidence?

Robertson: I think there’s been one too many coincidences here. What this looks like is that Cameron Slater knows what to ask for, and that’s the same situation with the SIS, Jason Ede and John Key’s office, that there are clearly conversations going on in the background, and this is the problem here. We’ve got from John Key down through Judith Collins and now we hear hundreds of comments from ministerial staff on Cameron Slater’s blog. It’s all part of the modus operandi of this John Key government to be able to feed material to a blogger who then incites hate. That’s what this government has become.

Russel Norman, I want to bring you in here. I mean, what do you make of this super-fast email service to Cameron Slater?

Russel Norman: I mean, I agree with what Grant said, and I think what it shows is a system. So, you know, the National Party over the course of its government has established a system where you have the kind of friendly face of the government over here, and then behind the scenes they’re working directly with Slater. And so he’s the dark operations and does all the really nasty attack stuff, but he’s doing it hand in glove with John Key, Judith Collins and all the rest of them. It’s the system that they established that keeps them looking nice and clean and friendly while at the same running these attack campaigns against anyone who gets in their way.

There’s no evidence of that, though, because he’s done everything within the law. We know that the OIA is tightly governed. I mean, how do you know that, that he just hasn’t looked at what’s happening in the media and said, ‘Hey, I’m going to put in something on this’?

Norman: This is a part of a broader pattern.  I mean, there’s masses of material that’s come out now that shows the close working relationship between the government and some of its leading figures and some of its staff, like Ede, but also Collins and Key, they were working very closely with Whaleoil throughout this whole period. I mean, you know, it’s a logical thing to do, I guess, for them. It means that they look like they’ve got clean hands over here, but at the same time they’re working with Slater on all the dirty stuff, and Ede’s obviously another conduit as well. You know, it’s a pretty straightforward approach, in the sense that it makes sense, but it’s not really how I think New Zealanders want their government to operate.

Sure. Grant Robertson, looking this week at the revelations about the SIS OIA to Cameron Slater about Phil Goff, what did you make of the Prime Minister’s explanation that when he himself, actually, as we saw in the YouTube video this week of his post-Cabinet press conference when he said ‘me’, he actually meant ‘my office’?

Robertson: Yeah, it’s very hard to believe. I mean, we’ve now got him saying that; we’ve got reference from Warren Tucker to discussions with the Prime Minister. I think it’s quite clear that the Prime Minister did know about this. But, again, I come back to the fact that in this situation, Cameron Slater knew what to ask for, and the reason he knew was because a person with the job title Senior Adviser to John Key was working with him – that’s Jason Ede. This goes right back to John Key. And if he’s condoning this kind of politics, then the rest of the ministers and the staff in the government will follow on. And I agree with Russel on this – this is the kind of politics New Zealanders hate, and it’s been driven right from John Key’s office.

Now, I want to turn now to economic policy, and Labour and the Greens obviously hoping to put a government together very shortly. I want to look at your tax policy. Now, listen, Labour, you want 36 cents in the dollar over $150,000. The Greens, you want 40 cents in the dollar on over $140,000. This is the tax rate, the top tax rate, and you can’t agree. You’ve got a month to go. Who wins? Grant Robertson, would you be prepared to put yours up?

Robertson: Look, we’re going out with what we think is the best package. We want to make sure that we pay debt, that we go into surplus—

But would you be prepared to—?

Robertson: And that we tax people at an appropriate rate.  And it’s important that we go out with what is our message, and the voters will judge us on whether we’ve got the package to reduce child poverty and also pay down debt and be in surplus.

Yeah, I think everybody understands that, but would you be prepared to raise the top tax rate in negotiations with the Greens?

Robertson: Well, I’m not going to do the negotiations on The Nation this morning. The reality of MMP is that there are always negotiations between different parties.

Don’t the voters have the right to know—?

Robertson: That’s what happens.

Don’t the voters have the right to know, Grant Robertson, if your top tax rate is moveable to even higher as soon as you get into those negotiating rooms? Because this is the first thing you’re going to have to talk about. This is how you pay for everything. So don’t the voters have a right to know? Can you shift it up, or is it rock solid at where you’ve got it?

Robertson: We’ve put out what we believe is the right policy, and we will sit down after the election and work with whoever the voters of New Zealand put up.

Great, so you’re saying—?

Robertson: We think this is the right balance.

We’ll take that as you’re prepared to put the tax rate up. Now, turning to you, Russel Norman—

Robertson: I don’t think I said that.

Norman: Not to put words in Grant’s mouth, but, yeah, go on.

You know, in terms of you, Russel Norman, I mean, Labour wants to stick to the 1.5 billion spending cap. David Parker, the finance spokesperson, said that. Are you prepared to stick inside that 1.5 billion spending cap as well if you go into a government with Labour? And you—

Norman: Well, I’d say—

So thinking hard, are you?

Norman: No, we put our fiscals, right, and we got them independently audited by Infometrics, and so what they show is that the Greens are running larger surpluses than the National Party, right – $2.2 billion.

Are you prepared to stick within the $1.5 billion spending cap that David Parker has said? Because he has effectively said, ‘You play by our rules or you don’t play at all’.

Norman: And so what each party needs to do is go to the election on their platform, so we’ve put out our fiscals very clear – you can look at all of them. We’ve got them audited by Infometrics. You can check them out, right, and Labour’s put out theirs. And then depending on— so the voters then make the decision, depending on Labour gets so many votes, Green gets so many votes, then we have to negotiate post-election. And the influence of each party in a democracy should be based on how many votes they get, and so that’s how it’ll work. So, you know, you talk about the top tax rate – the reason we put that in there for each dollar over 140K was to pay for a big package of child poverty reduction.

Very big.

Norman: And so we think that that’s a critical investment for the future of New Zealand, and we’ll be going to the table arguing that. Labour has a slightly different approach, and we’ll obviously have to negotiate. And how much influence each side has depends on the votes. That’s how a democracy works.

Well, here’s a question for Grant Robertson. This week when the Greens launched that policy, they said that they want to do an audit – an audit of your costings. How do you feel about that? I mean, should you audit theirs or what?

Robertson: Look, our costings have been out there since June.

Yeah, but do you want to audit the Greens’ costings? Because this is the stage we’re at when you guys are trying to get a government together and you don’t trust each other’s figures enough, you want to bring in independent auditors.

Robertson: No, look—

Norman: It’s not that—

Robertson: Our figures will stand on their own merits. The Greens’ figures will stand on their merits. We put ours out in June. We’ve got a fully costed policy there. Everyone can look at it. It’s been there since June. No one’s blown any holes in it. We’re very confident of our costings.

Norman: Yeah, that’s right. It’s a matter of due diligence, of making sure that we’ve got the numbers right, because the challenge for us is to put it all together. I mean, Grant’s right.

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