2. Hon PHIL GOFF (Leader of the Opposition) Link to this
to the Prime Minister
Does he stand by all his statements on GST?
Hon JOHN KEY
Hon Dr Nick SmithWe will get to him in a minute. Yes, I do, and if someone asked me whether I would want to raise GST to cover deficits, the answer would be no; it remains no today.
On what basis does he claim a mandate for increasing GST, when he explicitly promised the nation that he would not do so?
I seek the leave of the House to table a DVD in which the Prime Minister explicitly promises not to raise GST.
Mr SPEAKERWill the Prime Minister now admit to the country that he misled the country in promising not to raise GST to 15 percent, and that he has broken his word?
No, because my word was that I would not raise GST to 15 percent to cover deficits, and I will not do so.
Chris TremainHas he seen reports of people supporting a rise in GST accompanied by compensation through tax cuts, increases in benefits, and increases in superannuation?
Yes. As members will know, the Labour Government in 1986 introduced GST at a rate of 10 percent, accompanied by personal tax reductions, increases in benefits, and increases in superannuation. At the time, that proposal was greeted with enthusiasm by a person who said these words: “… every New Zealander will be better off under the proposals announced last night. … it introduces a fairer system for New Zealanders. It reduces the burden of personal tax, which wage and salary earners have to pay … If the goods and services tax is such a bad system, why has the National Opposition not pledged itself to repeal it? It will not do that, because it is not a bad system.” That was a great little speech from Phil Goff back in 1986.
I seek the leave of the House to table this document, which says National is not going to raise GST, National wants to cut taxes—
The member knows that seeking leave to table stuff that is in the common media is no longer approved in the House.
Has the Prime Minister ever said that raising GST will not be necessary if National was doing a half-decent job in growing the economy, and is his decision now to raise GST an admission that National is not doing even a half-decent job in managing the economy?
The question was whether I would be required to raise GST to cover deficits. The answer to that question is: “No, we will not.” In fact, National will not be increasing taxes; National will be reducing taxes, which actually proves we are doing a really good job.
Has the Government ever raised GST without compensating people through tax cuts, benefit increases, or superannuation increases?
Yes, actually. In 1989 the Labour Government raised GST from 10 percent to 12.5 percent with no tax cuts, no increase in benefits, and no increase in superannuation. People on lower incomes were left significantly worse off. That will not happen under a National Government.
Hon Jim AndertonWhen the Prime Minister, as the then Leader of the Opposition, told New Zealanders at his media interview 18 days before the last election: “National is not going to be raising GST.”, what did he mean by the word “not”? Does he have a lot of other definitions that most of us do not understand?
I urge everyone to look at the video. The exact question was whether I would raise GST “to cover deficits”. The answer to that question is no, I will not be raising GST to do that.
I raise a point of order, Mr Speaker. I asked the Prime Minister in that question a very simple point: to explain to the House his understanding of the word “not”. I expect to hear the answer.
I do not need further help on the matter. The Prime Minister disputed in his answer the basis of the question the member asked. I think he is perfectly entitled to do that.
Was his answer, word for word: “National is not going to be raising GST. National wants to cut taxes, not raise taxes.”?
Hon Trevor MallardI know it is a real downer for their story, but if I get asked a question, I answer it. Am I going to raise taxes and raise GST to cover deficits? The answer is no. But why let the facts get in the way of the story?
I ask both sides to please settle down a little. It is obviously a fiercely contested issue, and I have allowed a bit of noise and robustness, but please, as the member is seeking to ask his question could we have a little more order.
If the top tax rate is lowered from 38c to 30c, what percentage of the total spend of this tax package will go to the top 10 percent of income earners in that bracket?
I do not have that answer to hand. If the member wants me to go to the Inland Revenue Department, I can get him the answer to that question. We know that one in four New Zealanders who are tertiary qualified lives overseas. The probability of someone who is tertiary qualified paying the top personal rate, given that 300,000 New Zealanders are paying the top personal rate—
I raise a point of order, Mr Speaker. My question was very specific, as you know. The Prime Minister answered that question by saying that apparently he did not have that information. There is nothing else to add.
The honourable Leader of the Opposition makes a fair point. He asked a question that was very specific, following a very general primary question. The Prime Minister was very upfront and said he did not have that particular information. In fairness, I have to acknowledge that that should have been the end of the answer.
Under the policies he foreshadowed yesterday, which taxpayers will receive the highest dollar amounts per week in personal tax cuts? Will those taxpayers be the ones who need the money the most?
We do not know yet, because the tax package has not been formally put together, but of course one would logically assume that the highest taxpayers would receive the highest personal tax cuts, and that is because they pay the most tax.
Instead of giving the lion’s share of the tax cuts to the very top income earners, why does not the Prime Minister bring in a package that gives fairer tax cuts to those on $40,000, $50,000, and $60,000 a year, in line with his undertaking that this tax package would be fair to all New Zealanders?
All I can say to the Leader of the Opposition is that he is jumping to conclusions. He may find soon that he is factually incorrect.
I raise a point of order, Mr Speaker. The Prime Minister indicated that he did not have an answer to one of my supplementary questions, and that is a fair answer to a question. I wonder whether the Prime Minister would provide that answer subsequently.