What a hypocritical furore following the government’s announcement lifting the top tax rate from 33% to 39%. That means once over the threshold figure high income earners must now work all Monday and Tuesday before they’re left any money for themselves.
Numerous journalists and diverse economic commentators cried this wasn’t punitive enough. Tax wealth and capital they demanded and specially tax expensive homes.
Now before going any further I shall again tell the story I’ve often recounted that says everything you need to know about tax.
In or about 1991 the then new Bolger Government, in conjunction with Victoria University’s Economics Department, staged a massive tax conference. From memory it lasted about a fortnight.
Every conceivable sector was represented; Federated Farmers, trade unions, educationalists, retailers, exporters, importers, manufacturers, the different professions and so on and on.
Wellington’s two daily newspapers gave good coverage to every address.
It seemed I alone noted the common denominator, specifically that without exception every speaker outlined why society would be better off if their group was taxed less and they honed in on others they felt should be taxed more, for the greater good of society needless to say.
Well, we’ve watched the same scenario play out again since Labour’s 39% announcement.
Low paid journalists and narrow perspective economists, all people unaffected by the increase, have sung in unison, it’s not punitive enough. To quote Rob Muldoon they’re shallow as a birdbath.
Take lightweight broadcaster Jack Tame writing in the Sunday Herald. He arrogantly accused the Prime Minister of “selling out on tax by doing what is popular,” instead of what he, Jack Tame, thinks is right. What he thinks he out-lined and surprise, surprise it involved imposing taxes that wouldn’t affect him. He’s a classic example of the 1991 Conference speakers I’ve described.
Apart from my main proposition that everyone wants low taxes for themselves and more taxes on someone else, there’s another factor at play here, namely my life-long observation of the most powerful human emotion of all, namely envy of the rich.
The fact that the rich in the vast majority of cases deserve their success, their wealth invariably being based on doing something of value to society, of initial personal sacrifice and lots of hard work makes no difference to no-hopers of the smug Jack Tame ilk.
“Punish them” he urges.
Well, boy journalist, try thinking.
Punish the rich and they’ll do one (or more) of three things.
- Ask themselves why bother and go fishing, to society’s loss.
- Work out ways to avoid new punitive taxes specifically targeting them.
- Sell up and take their capital to a less hostile society.