Judith Collins has raised the spectre of Labour supporting the Greens’ idea of a wealth tax; so much so that Labour will implement the tax if they win the election. Labour’s response is that they have denied this many times and that National is “desperate”. Labelling the opposition as desperate is classic politics; it is all part of a particular mantra designed to make National look unfit to govern.
Unfortunately, Todd Muller, fiscal holes and Denise Lee (not to mention a disgracefully biased media) have all helped Labour in this respect, and Judith Collins is having a hard time pulling everything together and demonstrating that she and her party are more than fit to run the country. All respect to Judith; she manages to keep her cool in an increasingly hostile and difficult campaign.
The Green party wants to bring in a 1 percent wealth tax for those with a net-worth over a million dollars.
But Judith has now struck a chord, and it is a chord that cannot be ignored, no matter how much the opposition and the media brand her as “desperate”. The possibility of the next government implementing the wealth tax is much greater than has previously been implied, and we should all be very concerned about it.
I have said this before, but the main reason I dislike MMP is because voters simply do not know what they are voting for. You only have to go back to 2017 to prove that; just remember the people who voted for NZ First to ‘keep the government honest’, expecting a National-led government, only to end up with Labour and the Greens. Thankfully, it seems that voters are punishing Winston for his betrayal at the last election, but the point is still valid; once parties get into post-election negotiations to try to form a government, all bets are off, and all election promises go out the window.
For the record, I do not believe that Labour particularly wants to implement a wealth tax. They know it will be an unpopular move, particularly with older voters, who will be the group most affected by the tax. But you have to ask this question: if the Greens decide to play hardball and insist that a wealth tax is a bottom line for them to go into government with Labour, do you think Labour will walk away from forming the next government?
Not on your life.
James Shaw has already stated that a wealth tax is a “priority” for the Greens after trying to walk away from a statement made by Julie Anne Genter who said that it would be a “bottom line” for the Greens. He has been taking lessons from Winston. He is well aware that the Greens may be in pole position in post-election talks. Until now, the Greens have never been in a position of power. They have always been the desperate little brother, sitting on the sidelines with an empty bowl, hoping for a few scraps. Just remember how Winston refused to even acknowledge them as a coalition partner in 2017. But if current polling proves to be correct, the Greens will hold the balance of power. Labour is likely to be the party with the largest share of the vote, but not enough to govern alone. They will depend on the Greens to form a government.
Now do you think that the Greens will use that power to their advantage, seeing that, for the first time ever, they will be able to hold Labour to ransom?
Of course they will.
In other words, Labour may not want to implement a wealth tax, but if the Greens make it a bottom line for them to form a government, Labour may have no choice. And if you think that Labour is too principled to be held to ransom like that, and they will meekly hand over power to National and ACT, then you are wrong. That won’t happen.
So Judith Collins may be right, and we may end up with a wealth tax, even though Labour doesn’t really want it. Yes, it may be political suicide, but Jacinda won’t care. She won’t be at the helm in three years time. Someone else will have to mop up the mess she has left behind.
The biggest problem, in my recent experience, is that voters do not understand what a wealth tax is. I listened with boiling frustration last Thursday morning as listener after listener, talking about the proposed wealth tax, confused it with capital gains tax. Even Kerre McIvor claimed that it would be no big deal to pay 1% of the cost of your $1.5 million home in tax on its sale. I do wish that radio presenters would make some effort to get their facts straight; how can you hold a narrative when you don’t understand the fundamental issues?
Wealth tax is a tax on assets worth over $1 million and will be paid every year. It is a tax on unearned income, and is, therefore, a punitive form of tax, as many payers will have to either borrow to pay it or will be forced into hardship. The first principle of Taxation 101 is that tax is supposed to be fair. Wealth taxes break that fundamental principle and can therefore be classed as usury.
Don’t think for one minute that any of that will stop it being implemented.
The only way to be certain to avoid the introduction of a wealth tax is to vote for a National/ACT government. Tell your Labour voting friends, and make sure they understand what a wealth tax really is. I have just managed to convert a Labour voter into a National voter by pointing out the likelihood of the wealth tax being implemented. He will no doubt hold his nose when doing it, but when a government is likely to hit you badly in the pocket, it is time to reconsider.
So next time someone tells you how ‘desperate’ National is, ask them if they have over $1 million in assets. Then ask them how they will feel about the extra tax each year, and how exactly they are going to find the money to pay it. This could be a game changer.
Like Steven Joyce’s $7 billion hole in Labour’s budget, let us not go back down the track of National being correct but shouted down by people with an alternative agenda. We don’t want a wealth tax in this country. Apart from being punitive and driving people into poverty, it will cause economic chaos. Such a prospect has never worried the Greens, but it should worry us all. The Greens will do this if they can, and Labour’s likely inability to govern alone will give them a golden opportunity that they will not want to turn down. You have been warned.
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