Mana Campaign Introduction by Matt McCarten

The Unite Union has announced its endorsement of its General Secretary Matt McCarten to contest the Mana by-Election. McCarten is required to contest the election as an independent.

The Unite Union has been at the forefront of campaigning for low income workers in New Zealand over several years.

This government over the last year has launched attacks on workers that include the right for any worker to be sacked without notice or reason on the whim of an employer. In addition they are restricting the rights of workers by restricting union access to their members. The sale of holiday entitlements is only the start of claw backs for vulnerable workers. The cravenness of John Key to the US owners of the Hobbit films to even change our employment laws says it all.

Unite launched a campaign over a year ago to win $15 an hour minimum for every worker. 200,000 New Zealanders have signed our petition. Unite intends to make raising wages a central issue for the by-Election and will seek the support of all the candidates.

This government has no economic plan and just hopes that somehow the international markets will come to our rescue. They won’t.

By-elections are democratic processes where not only will they elect a new MP but they have an opportunity to send a message to parliament. Unite intends to do that.

We have been supportive of Labour’s long overdue realisation that the new right agenda implemented by their party and carried on by National have been a disaster for New Zealand. But we have been disappointed at their timidity over what the alternatives could be.

My candidature will give the people of Mana strong alternatives that roll back the failed ideology of the past 25 years.

We intend to run on three main platforms and seek a mandate from the voters of Mana:

#1 $15ph Min Wage NOW. 
Raising wages is central to the campaign. The practical way to close the wage gap with Australia is by legislating for an immediate increase in the minimum wage to $15 an hour. If I win we will see that as a mandate to have a Royal Commission set up to enquire into what income a worker on 40 hours would need to live with dignity. Once established then appropriate economic and employment policy would be needed to ensure this happens. During the next 3 weeks we will seek to have a majority of the people of Mana to sign our petition to raise the minimum wage to $15 immediately. The cabinet currently is reviewing the minimum wage and we want a strong message sent to them from the voters of Mana.

#2. Jobs. 
The free market won’t reduce unemployment. Government intervention is required to do that. Mana like every other electorate has about 3000 official unemployed. The dignity of meaningful work is an economic good in itself. To employ 3000 on $15 an hour in fulltime work costs less than $100m a year net. After giving over $1.6 billion of our money to South Canterbury Finance it’s clear it’s not about have we got the money, it’s about priorities. I want a strong message sent that no one gets the dole. The government will invest in jobs. In Mana we could put two teachers’ aides into very classrooms creating almost 1000 jobs. We could get the Wananga to train 500 young unemployed in basic building skills and set them up to repair and upgrade run down state houses. We can get another 500 into home help for senior citizens and the sick. It’s not science; it’s whether we have the will.

#3. Taxes. 
The burden of paying the bills has dramatically shifted to the from the asset wealthy and high incomes to the middle and low income New Zealanders. GST is one of those taxes. Labour weak response is disappointing. I will release an alternative tax policy in the campaign to start the discussion off. Frankly GST has to go and an alternative like the Financial Transaction Tax (now enjoying popular support overseas as the Robin Hood tax) is fairer and more efficient.

I will also release policy discussion papers during the campaign on economic planning that includes foreign investment and immigration; and workers’ rights to start a discussion for areas that are clearly failing.

I intend to run a strong aggressive campaign and put the two main candidates under some pressure to work for their votes and ask them to respond to the above three platforms. Whilst I will target National (as the villains of course) Labour also has to engage in meaningful debate rather than generalisations.

The Other Candidates: All the candidates are fine people and are to be congratulated for offering themselves. But this by election isn’t about them or me. It’s about the people of Mana and the rest of New Zealand. I intend to engage in serious debate and persuade the people of Mana to send a big message to parliament to elect me as their representative to parliament on the 20th of November.

Claiming GST is universally applied today is the biggest lie

Tax Justice media release
28 September 2010

“John Key has accused the Labour Party of lying in their pamphlet on National’s GST hike, but Mr Key is hardly squeaky clean,” says Vaughan Gunson, Tax Justice campaign coordinator.

“John Key and the National-led government have been spinning untruths about GST,” says Gunson. “Chief among them is the claim that the “beauty” of New Zealand’s GST regime is that it’s universally applied.”

Peter Dunne, Revenue Minister in the National-led government, said in July that “it’s not New Zealand’s policy to have a non-universal GST.” (See Key rules out GST-free food, 21 July 2010.)

“This is not true,” says Gunson. “GST is not applied universally today. The major exemption is for financial services.”

Inland Revenue lists the following financial services as exempted from GST: dealings with money; certain dealings with securities; provision of credit and loans; provision of life insurance; provision of non-deliverable futures contracts and financial options; the payment and collection of interest, principal and dividends; and issuing securities such as stocks and shares.

“The main users of these financial services are rich investors, speculators, banks and other wealthy corporates,” says Gunson.

“Why is it okay for them to get off paying GST, when grassroots people struggling to make ends meet have to pay tax on food?” asks Gunson. “John Key needs to fess up to the people of New Zealand and admit that our tax system has a rotten core.”

“We’re forced to stomach GST on food, while something as destructive to the economy as financial speculation goes untaxed.”

The Tax Justice campaign is promoting a doable solution to New Zealand’s unjust tax system. Over the last few months over 12,000 New Zealanders have signed a petition calling on parliament to:

1. Remove GST from food; and
2. Tax financial speculation.

“The tax revenue the government’s receives from GST on food could easily be replaced by introducing a Financial Transaction Tax (FTT),” says Gunson. “A small percentage tax on financial transactions would net billions from rich speculators and wealthy corporates, who are today enjoying a free ride from GST. We need to move quickly on this now.”

“The issue of tax justice for grassroots Kiwis is not going away. We’re confident the campaign is going to get bigger and bigger.”

JB Hi-Fi workers strike to protest low wages and GST rise

Unite Campaigns Organiser Joe Carolan said that while “Taxes that hit low paid workers hardest are going up, for the last three years JB Hi-Fi workers have had no pay increases whatsoever. We need a Living Wage, not new taxes on the working poor.  Thats why we say $15ph, not 15% GST.

“Our Delegates representing several JB stores throughout Auckland will be striking from 1pm tomorrow Friday, and picketing JB Hi-Fi HQ opposite St Lukes Mall at 2pm.

“We say abolish GST, and replace it with a ‘Robin Hood tax’ on big financial transactions like the ones JB Hi-Fi's management make every day.

“After protesting the price rise, workers will be taking their demand for a Living Wage to JB Hi-Fi's HQ, accompanied by a seven metre tall rat.”

More info:
Joe Carolan
campaigns Officer
Unite Union
029 44 55 702
joseph@unite.org.nz

The land of 15% GST

John Key’s other New Zealand flag

by Vaughan Gunson
Tax Justice campaign coordinator
10 June 2010

On 1st October a long black cloud is going to descend on the lives of grassroots New Zealanders. GST will increase from 12.5% to 15%, making everything more expensive. The new rate puts New Zealand in the top bracket of countries with equivalent taxes on goods and services (see http://en.wikipedia.org/wiki/Value_added_tax).

On the same day, the National government’s other tax changes will come into place, including across-the-board lowering of income tax rates.

For low-to-middle income people the small improvements in take home pay resulting from the tax cuts will be mostly wiped out by the increase in GST on food, electricity, clothing, rates charges, and other items that must be accounted for in weekly budgets. As has been widely reported, it’s the rich and wealthy corporates who get the most out of the tax cuts.

Hone Harawira mad at GST hike - not the only one

 Hone signing the GST off food petition launched by RAM in 2008

In his regular column Ae Marika! written for the Northland Age, Maori Party MP Hone Harawira gets mad, very mad, about the rise in GST (see below). And he's not going to be the only one when the GST increase comes into effect.

National's paltry income tax cuts for low-to-middle income people will be forgotten when weekly budgets get blown to bits by the GST hike, which will be compounded by these related factors:

• Retailers will undoubtedly try to increase prices a little extra on top of the 2.5% GST increase;
• The price of food is widely predicted to go through the roof this years as a result of global speculation in food commodity prices; 
• Bosses citing the income tax cuts as a reason not to give decent pay increases.

The tax campaign launched by Socialist Worker and the Alliance Party will be well-position to tap into widespread anger. The jointly sponsored campaign petition demands that GST be removed from food and financial speculation taxed. To download copies of the petition click here. 


CAN’T BUDGE-IT

by Hone Harawira, MP for Tai Tokerau
from Northland Age
25 May 2010

Speaking out against the increase in GST in last week’s budget wasn’t a hard call for me because the people who are going to be hurt the most by it are the people I grew up with, the people I live with, and the people I represent.

I don’t like being told I have to support something I don’t agree with and I don’t like being told to keep my mouth shut either, and even though our coalition agreement with National means that we have to vote for the Budget, I was pissed off that we weren’t speaking out against the GST increase when none of us supported it.

GST is a tax that you pay on nearly everything - food, petrol, electricity, clothes, schoolbooks, everything - and when you don’t have a lot of money to start with, every little price rise hurts.

Gordon Campbell: On the trade-offs in the Budget

21 May 2010

Raising the level of GST – which will hit those on low incomes the hardest – and offering in compensation a package of tax cuts that will reward those on high incomes the most, is a very strange definition of fairness. Yet fairness and virtue have been central to the spin on Budget 2010. Finance Minister Bill English has been at pains to present his Budget 2010 package as being all good things to all good people – an elixir that will contain a reward for effort, be motivational to all and fair to everyone.

The new income tax rates that will kick in on 1 October, English explained by way of example, will offer an ‘incentive’ for those who mightn’t otherwise decide to work that extra hour of overtime. (On Planet English, everyone is in work and has the luxury of doing overtime, or not.) Lets put to one side the fact that wages for many are so low that people need to work overtime – when they can get it – to make ends meet. The wider reality is that Budget 2010 will cement in place our existing levels of income inequality, or worse. English explicitly recognised this outcome, but portrayed it in benign, or neutral terms. The income tax cuts, he promised, “will more than offset the rise in GST – and low, middle and high income earners will broadly receive the same proportionate increase in disposable income.”

The GST rise big story of the Budget

By David

The GST rise is definitely the big story of the Budget, even Greenpeace’s press release focuses on it.

Although, disappointingly, they call for the “strengthening” rather than scrapping of the ETS pollution market, and offer an endorsement of the UK’s new Tory leader David Cameron, who allegedly possesses “some forward-thinking and visionary ideas.” (Which is news to me, as I was under the impression he was just another Margaret Thatcher / Tony Blair corporate clone... rather like John Key.)

The focus on this regressive tax increase, rather than the cuts in income tax is bad news for National and a another sign that the public mood is turning against the Government.

In their official statement, the Maori Party did their best to accentuate the positive, by listing all the little projects that got funding, and asking their supporters not to focus on GST:

“We know that the biggest challenge will be in encouraging our constituency to look broader at the whole picture of the budget – rather than focusing on one measure in isolation.”

But such a focus is unavoidable. As Maori Party MP Hone Harawira put’s it:

“GST hits poor people the hardest because nearly all of their money is spent on things that you pay GST on – food, petrol, electricity – so any increase is going to really hurt them.”

That extra 2.5% will be increasing the impact of every peak oil petrol price hike, and every world commodity market induced rise in cheese or bread.

Harawira’s personal statement against the GST rise, and his request to party leaders for permission to vote against the increase, have earned both praise and criticism.

Marty G at The Standard urged Harawira to “have the courage of his convictions” and cross the floor to vote against the Budget even with out his party’s permission. In the event, Harawira’s vote, along with those of the five other Maori Party MPs went for the Budget.

Comments on the post have suggested that voting for the Budget makes Harawira a wimp, a sell-out or a blowhard. But while I would have applauded Harawira had he crossed the floor, I think it would have been a tactical error for him to go against the wishes of his party leaders, at this time.

The right wing of the Maori Party have already tried to force him out, for the trivial offence of using offensive language when pointing out the crimes of Pakeha parliamentarians in a private email. To break ranks over this issue would only given them another excuse.

Maori Party co-leader Tariana Turia had the support of (and was under pressure from) a hikoi of tens of thousands before she broke with Labour over the foreshore and seabed act. Who does Hone Harawira have? How many people took to the streets against the GST rise?

The only thing coming close is the few dozen of us who went out today to launch the Socialist Worker – Alliance petition calling for GST to be removed from food and financial speculation to be taxed.

Activists send message to Key: “Make the banks pay!”

Bad Banks media release
13 May 2010

Prominent New Zealand activists and unionists are among the 53 public signatories to a letter to prime minister John Key calling for action to curb banking power and protect grassroots people. The full list of public signatories is included below.

The letter, written on behalf of grassroots people in New Zealand, reads:

Dear Mr Key,

Why are you wanting to raise GST? Food and everything else will be more expensive. It's already hard to make ends meet. Why don't you tax the banks and other fat cats that have been ripping us off? We want justice Mr Key, make them pay.

Signed,

Grassroots people of NZ

Bad Banks leaflet #6: MAKE THE BANKS PAY

The latest Bad Banks leaflet is out now (leaflet #6). It features on the front a "letter" to prime minister John Key, which reads:

Dear Mr Key,

Why are you wanting to raise GST? Food and everything else will be more expensive. It's already hard to make ends meet. Why don't you tax the banks and other fat cats that have been ripping us off? We want justice Mr Key, make them pay.

Signed,
Grassroots people of NZ

On the back of the leaflet, under the headline 'Make the Banks Pay' are three demands:

1. Stop forced mortgagee sales
Regulatory muscle used to stop banks turfing people out of their homes. A government body to oversee the re-negotiation of mortgages based on current market values and ability of the homeowner to pay.

2. Turn Kiwibank into a proper public bank
Offering 3% interest loans to first home buyers, zero-fee banking for people on modest incomes, and low interest loans to local bodies for sustainable eco-projects in the public good.

3. Introduce a Robin Hood Tax
(also known as a Financial Transaction Tax)
A small percentage tax on financial transactions would net billions of dollars from banks and global financial speculators. GST could be phased out.

These "common sense" measures to curb banking power and protect grassroots people should hit the mark with people who already have negative attitudes towards the banks, which is the majority of New Zealanders. Early feedback from people on the street to the new leaflet has been positive.


SIGN ON TO OUR "LETTER" TO JOHN KEY

To go with the new leaflet, there's a 'Make the Banks Pay' sign-up sheet where people can give their support to our "letter" to John Key and the three demands.

If you would like bulk copies of Bad Banks leaflet #6 and the 'Make the Banks Pay' sign-up sheet, contact Vaughan svpl(at)xtra.co.nz or 021-0415 082.

Send all completed sign-up sheets to Socialist Worker/Bad Banks, PO Box 13-685, Auckland.


SIGN ON ONLINE

There's an online version of the 'Make the Banks Pay' sign-up. Go to http://www.ipetitions.com/petition/badbanks/ to add your signature. Tell your friends, family and workmates. We want to get as many signatures as possible, to grow the campaign and hopefully get crucial media coverage.

You can also join, and invite others to join, the 'Make the Banks Pay' Facebook group. Go to http://www.facebook.com/#!/group.php?gid=392390694275&ref=ts


IN THE MEDIA AT BUDGET TIME

There's going to be a lot of media coverage either side of the upcoming budget (20 May) about an almost certain hike in GST, as well as other policies the National government will be implementing in response to the global economic crisis. It's possible that the alternative message of the Bad Banks campaign: "make the banks pay, not grassroots people", could break through into the media. That possibility will be increased if we can build some campaign momentum on the ground and online over the next couple of months.

If we work hard we may be able to lift the Bad Banks campaign to the next level. The three "common sense" measures are necessary to curb banking power and protect grassroots people in New Zealand. If we act together we just might be able to deliver a blow to the banks.

In solidarity,

Vaughan Gunson
Bad Banks campaign manager
svpl(at)xtra.co.nz
021-0415 082

Hey, Labour MPs, why not support GST off food?

by Vaughan Gunson

I was scrolling down Scoop's top 30 stories for the day and got quite excited by this headline: "Labour Wellington MPs want to Axe the Tax". What tax? Must be GST. I'd better read on.

Yes, Wellington Labour MPs do want to "Axe the Tax", but they only mean the portion that National is planning to increase GST by, from 12.5% to 15%. I should have known not to get too excited by a headline. Never-the-less, Labour MPs are getting out there in response to the groundswell of public opinion against any hike in GST.

Judging by the language these Labour MPs are using and the basic food examples in their media release, it would be reasonable to assume these MPs would support removing GST from food. A demand that's proven to be hugely popular with people (see the front page story in the Whangarei Leader for a snap-shot of the mood on the street: Take GST off food, 16 Feb).

Connect with this grassroots mood and you've got a campaign that could undermine the whole neo-liberal tax structure. A mass campaign for GST-off-food would, if successful, be a mortal blow to one of the pillars of neo-liberalism, as GST certainly is.

But Labour has so far been very reluctant to embrace this popular demand. Is it because GST-off-food strikes at the very heart of neo-liberalism? To roll back GST would mean campaigning against the powerful proponents of this regressive tax: the big corporates operating in NZ. Is this a step too far for the Labour Party leadership?

Phil Goff says Labour won't support Maori Party MP Rahui Katene's private members bill to remove GST from healthy foods. And Goff won't even commit to reversing National's GST increase if Labour were the government. What does this mean for the "Axe the Tax" bus? Does it get parked away after the Budget in May?

Prime minister John Key has challenged Labour to campaign on reversing the GST increase at the next election. Key has framed the debate in these terms: you either have an increase in GST or an increase in personal income tax. This has put the Labour leadership in a bind.

But only if Labour wants to accept how the debate is currently framed, because there are circuit-breaking options. Most clearly, a Financial Transaction Tax (FTT), or Robin Hood Tax, as it's been so-named by the campaign originating in Britain.

Instead of the GST-income tax trade off, let's target the mega-wealthy. A small percentage tax on financial transactions (say 0.5% or 1%) would raise billions of tax revenue from the banks and other big corporates, including the global financial speculators who buy and sell the Kiwi dollar, one of the world's most traded currencies. (For more on why a FTT is an idea whose time has come, read these recent articles by John Minto, Finlay MacDonald and Barry Coates.)

So a circuit breaker for Labour MPs exists, but do they have they have the guts to take it? A tax on financial transactions would hit the big banks and other global financial overlords that have run amok with the world economy since the mid-1970s. In campaigning for an FTT you're buying a fight with some powerful global forces. 

But it's a fight that must be fought if any kind of tax justice for grassroots people is to be achieved.

With the banks and other financial "fat cats" on the back foot following the financial implosion and their widely perceived role in causing it, there's an opportunity to go on the offensive. That's not to underestimate the size of the task. To roll back GST and force the introduction of a FTT would require serious and sustained campaigning by broad forces, in order to win the active support of the majority of New Zealanders. So that when the inevitable opposition from powerful political and economic forces comes there's a mass base from which to push the cause of tax justice.

Is Labour going to be part of this struggle, or not? Will the axe stay out, or will it be left in a cupboard in one of the corridors of parliament?

Here's a challenge to Labour: why not keep the axe out and support the campaign to remove GST from food, which would be a decisive first step towards tax justice in New Zealand.

So Labour Party people, what do you say?

"$15ph not 15% GST" picket outside National MP's Whangarei office

by Vaughan Gunson

20 people joined a picket outside Whangarei National Party MP Phil Heatley's electoral office as part of nationwide pickets called by the Campaign for a Living Wage.

Linking the campaign to lift the minimum wage to $15ph with popular opposition to a GST hike resulted in a pretty good turn-out for a Whangarei action. And there were heaps of toots of support from passers-by.

The Green Party, Socialist Worker, the Tertiary Education Union (TEU) and the Progressive Party were represented on the picket, along with other local activists and workers.

The picket had good media coverage, with a story in the local paper the night before, a radio story the day after, and a follow up photo in the local paper. The action has given a boost to the minimum wage campaign in Whangarei, as well as broad left cooperation in general.

Rahui Katene: Shifting the burden of taxation to those who can’t pay

Rahui Katene

Finance Spokesperson for the Maori Party Prime Minister’s Debate Tuesday 9 February 2010

There was a statement that the Prime Minister made in his speech this afternoon that I am sure would be endorsed by every single member of the Maori Party – and I’m talking about the 23,000 members not just the five in this House. It was the recognition that he was “impressed and heartened by the resilience and optimism of New Zealanders and by their desire to do better for themselves, their families and their communities”. As I travel across Te Tai Tonga I am frequently in contact with people who are struggling to survive. The median family income for my constituents is $54,500 – some five thousand less than the median family income for New Zealand as a whole. Five thousand dollars that makes a difference at the petrol pump, at the supermarket checkout, at the pharmacy, at the bank. Today we are asking those same people to agree to a rise in GST to 15 percent. GST, of course, is an issue dear to my heart. Tomorrow, I will once again submit into the ballot my private members bill, the Goods and Services Tax (Exemption of Healthy Food) Amendment Bill. This is a bill which has directly responded to the situation for the people of Te Tai Tonga; the people of the Maori electorate, every day New Zealanders who are powerfully motivated by the desire to do better for themselves, their families and their communities. These every day New Zealanders have suffered from the impact of food prices which have risen more than twenty percent in the last three years, while real incomes have risen only very slightly. Within that, we know that increases for the staples of a nutritious diet – such as fruit, vegetables and milk – have been particularly high. In response to the long term impacts this could have on public health, organisations such as the Public Health Association of New Zealand Inc and the Heart Foundation of New Zealand, have called for goods and services tax to be removed from foods which constitute a healthy diet to make them more affordable. I repeat – their call is for GST to be removed – not to rocket up to 15%. I want to make it absolutely clear that the challenge faced by many of our families is of the harshest kind. It is our families who suffer from the reality that New Zealand’s after tax distribution is one of the most unequal in the OECD. It is our families, disproportionately, who are suffering from the unacceptable level of child poverty. Rates which are so dire that the 2008 Survey of Living Standards reported 19 percent of children are experiencing serious hardship and unacceptably severe restrictions on their living standards. Mr Speaker, these are the faces of the families that I take with me into this debate. We are pleased that our consistent call to remember these families has been reflected in the announcements made earlier today by the Prime Minister. We have welcomed the decision of the Government that any decrease in personal tax would be done across the board. If there are across the board personal tax cuts, then we will certainly be doing everything we can to ensure that our people will see some sort of benefit. We have certainly noted the statement of the Prime Minister that fairness is a very important consideration to this Government. And so we will be talking closely with the Government about finding a common context for what we mean by fair. Is it fair that 51% of beneficiary families with children are ranked as experiencing serious hardship? Is it fair that 28% of families with children had serious health problems for at least one child in the past year? Is it fair that for 22% of families keeping the house warm is described as a major problem, with another 17 percent saying that dampness or mould were major problems? The challenge we face as a Parliament, is to ensure that the current levels of inequality and poverty are not intensified by the tax package highlighted today. It would appear that we are shifting the burden of taxation from the people who can pay it to those who can’t. For those at the top income level, there are ways and means of claiming the GST back – they can set up trusts, they can increase rents, they can make the end user pay. But for those at the bottom level, there is no other place they can claim the money back from. And so we will be greatly interested in the discussions around fairness and equitable outcomes, particularly as they relate to the low income. The key thing for us is that there is an opportunity for dialogue; and within that we hope to put forward some of the key ideas that we have promoted from the Maori Party. And so I go back to that collective desire that I would hope we share across this House, to respond to the aspiration of the people to do better for themselves, their families and their communities. As a first start we must do something to unacceptable levels of serious hardship that compromise living standards. We must increase the minimum wage – and by more than 25 cents – we want to see a minimum wage of at least $15 an hour. We are greatly pleased that the benefits, superannuation and working for families policies will be increased to assist people on low incomes. Now if we were really to show a level of responsibility for those more vulnerable, we would put measures in place to ensure that the first $25,000 of income is tax free. We need leaders who see that small is the new big. We need visionaries who can create opportunities for a new economy, who are not mired in old thinking and tainted by the existing economy. We need more Grameen banks - we need community banks. Vision is what we need – not more of the same. And so as a Coalition Partner with the Government we expect to be involved in discussions concerning the nature of the income support provided to New Zealanders. We do support the goals of reducing dependency on benefits, but it is absolutely critical that at the same time we maintain an appropriate safety net for those in genuine need. We are really concerned about the vulnerability of sole parents to fluctuating income. Sudden change can often have a detrimental effect on the whole whanau. We know that far too easily families go further into debt just to meet the basic costs of food, rent and power. For too many of these families the opportunity to take up full time work is simply not available. While we are supportive of efforts to gain better entry of Maori into the workforce, we will not accept any proposals which threaten the capacity of whanau to be able to maintain a reasonable standard of living. We do not want to see our whanau in a worse off position through any of the ideas being floated. And in this regard, I am honour bound to remind the House that in the design of the Working for Families, the policy architects of that scheme effectively cut out the poorest 200,000 children who have been left, floundering, in increasing poverty. Finally I bring us back to a concept that resonates with tangata whenua – He aha te mea nui o te Ao, what is the most important thing in the world? He tangata, he tangata, he tangata. It is people, it is people, it is people.

Reverse Robin Hood from tax working group

By David A report by the Tax Working Group has ignored the popular campaign for GST to be removed from food, calling instead for an across-the-board increase in GST to fund tax cuts for the wealthy. National, various business groups and much of the media have embraced this idea, although they appear less keen on the report’s proposal to tax rental properties. The Tax Working Group was one of several economic “taskforces” established by the National Government soon after the last election. It’s report has been contrasted with the free market fantasy produced by Don Brash’s 2025 Taskforce – which claimed cutting the minimum wage would somehow help wages increase to Australian levels. But praising the tax report as free from “ideological rhetoric” misses the point that many of its proposals are straight out of a neo-liberal economics text book. Cutting taxes on the rich and introducing GST was a core part of Labour and National’s free market reforms in the ’80s and ’90s. In the classic reverse Robin Hood free market style, they made the rich richer, by taxing them less and making everybody else pay more. This time round, the Dominion Post calculates that cutting the top personal tax rate from 38 percent to 33 percent would “put about $20 a week in the pockets of workers on $90,000 a year but give those earning less than $70,000 nothing.” And of course we’d also get hit with a 2.5 percent rise in the cost of everything else, thanks to the rise in GST. Rich rort tax system On top of the worn-out claims that making the rich richer will help us all, a new and bizarre argument is being deployed. The rich aren’t paying their fair share, wage and salary earners are paying too much, therefore (and this is the bizarre bit) we should cut the top tax rate and increase GST. According to the Dominion Post, “an Inland Revenue sample of 100 of the richest New Zealanders showed only about half were paying the highest marginal tax rate on their income.” The solution to this “tax rort”? Close the loopholes and go after the dodgers? No way, just cut the top tax rate. The economic theory behind this approach is that if the rich didn’t have to pay so much tax then they (or their accountants) wouldn’t work so hard to avoid it. In other words change the law to make the problem disappear. I’d love to see this logic applied to the crime. Instead of the new “three strikes” law we’d have something like this ... “In a bold new move to tackle rising violent crime figures the Government has announced they will stop counting assaults.” The funniest thing about the report may well be the claim by Finance Minister Bill English that he found “startling” the reports revelations that many rich people were “able to restructure their affairs” using a “company, trust or special savings vehicle” to avoid tax. Hang on. Wasn’t that pretty much what English himself did in the housing allowance scandal? The next sentence in the the Dominion Post report might be closer to the truth: “That only half of New Zealand’s wealthiest individuals were able to avoid paying the top rate of tax would be ‘astounding to the layman’, he [English] said.” This looks like English is saying that it’s surprising that only half were avoiding tax (surely this is a typo?). We can shift the tax debate In the run up to the last election, National was able to tap into discontent about low wages and rising prices with calls to close the wage gap between New Zealand and Australia. Of course they weren’t talking about a 25 percent increase in wages, instead they managed to focus the debate on tax cuts. Labour made things easy for them, because they opposed big wage rises too. Instead they cut taxes before the election, which not only looked like a pathetic election bribe attempt, but also backed up National’s argument that tax cuts are the solution to poor pay. Both parties were also united in their opposition to calls for GST to be removed from food. Nevertheless, the campaign to make food GST free – initiated by RAM and supported by the Maori Party, Grey Power and others – gained significant public support, with one pre-election poll showing 73 percent in favour. In power, National postponed its tax cuts, because of the recession. Now they are back on the agenda. But with such dodgy arguments being deployed in favour of tax cuts for the wealthy, paid for by a GST rise that will hit low and modest income people hardest, there’s wide open political space for a revival of the GST off food campaign. Another progressive tax reform supported by RAM as a way of funding GST cuts is a transaction tax on the movement of large sums of money. Ten years ago, this idea, some times known as a Tobin Tax, was a major spur to the European mass movement ATTAC, which played a key role in launching the World Social Forums. More recently, this idea has been raised by the Maori Party, Jim Anderton’s Progressives Party and Socialist Worker’s Bad Banks campaign. No doubt there are many other tax reforms that the Left could rally around, and that many people would support. With the next Budget four months away, there is plenty of time to campaign around this issue. But perhaps not enough time to build a campaign big enough to stop National’s reverse Robin Hood reforms. Nonetheless, if we can make a bit of a fuss, we can shift the tax and income debate away from the idea that income tax cuts, rather than wage rises are the way to boost take home pay. We may also be able to pressure Labour and the Greens into supporting taking GST off food, setting this up as a central issue at the next election.

Maori Party - Take the GST off healthy food

Rahui Katene, Finance Spokesperson
20 January 2010

Maori Party finance spokesperson, Rahui Katene, has welcomed the Government’s statement this afternoon that any changes to the tax system would have to meet tests of equity and fairness, alongside delivering benefits for households and the economy.

“In that context, the recommendation from Bob Buckle’s Tax Working Group that GST should be raised to 15% clearly doesn’t make sense”.

“If we want to do anything to achieve equity and fairness it would be to remove goods and services tax from healthy food”.

“I have a private members bill all ready to go, which will address rising food prices and the impact this has on the ability of those in low income households to purchase healthy food by exempting this food from goods and services tax” said Mrs Katene.

“While all consumers will benefit from the removal of GST from healthy food, those on lower incomes spend a greater proportion of their income on food and will receive a significant benefit as a result. Research conducted both here and overseas shows that lowering the price of healthy food, including via the removal of taxes similar to GST, leads to a significant increase in the purchase of healthy food”.

"Increases for the staples of a nutritious diet – such as fruit, vegetables and milk – have been particularly high. It is increasingly important that healthy food be affordable".

“If Mr English is really keen to help families to get ahead, he will be ringing the Maori Party to place my Bill on the Government’s Order Paper” said Mrs Katene.

“What’s so positive about my Bill is that it not only seeks to exempt healthy food from goods and services tax but it is also about encouraging the purchase of healthy food” said Mrs Katene.

“That’s benefits for households, the economy and the health of the nation all in one clean sweep”.

GST increase would be unfair for low and middle income earners

Alliance Party media release
4 September 2009

The Alliance Party says an increase in GST would hurt low and middle income earners.

Alliance Economic Development spokesperson Quentin Findlay says suggestions from the Taxation Review Group to increase GST to subsidize corporate tax cuts would increase the pressure on many New Zealanders.

“The vast majority of New Zealanders spend a lot of their money on food. There has been a major increase in food prices in the past years due to a range of factors. An increase in GST would push food prices even higher and in some cases out of the reach of ordinary people.”

A rise in GST would cancel the effect of the recent tax cuts on middle income earners. However, for lower income workers, beneficiaries, students and superannuitants, who didn’t get a tax cut, an increase in GST would mean real hardship as basic living costs rose even more.

“The main focus for this tax review is to push the right wing agenda as far as possible in the shortest time possible. A rise in GST would be another move backwards.”

Mr Findlay says that the Alliance was committed to removing GST and was particularly committed to removing it off food in the first instance. The Alliance advocated a Financial Transaction Tax to replace GST.

“At the moment, lower and middle income earners subsidize the rich and businesses through the tax system. The Alliance’s Financial Transaction Tax would go someway toward correcting that imbalance by being levied at a progressive rate, ensuring that those who could well afford it paid more.”

The Alliance is also opposed to placing more people on the benefit when they did not need to be. The solution to that was obvious, Mr Findlay said.

“What is needed is more jobs at award rates with their conditions guaranteed. People should not have to get a benefit merely to buy bread and the Alliance will ensure that they don’t.”

See NZ Herald article on the proposal made by the Taxation Review Group to increase GST to 15% GST hike should not be written off.

See also

• The Standard supports raising GST by Auckland Unionist
• Greens should come into line with leftists on GST by Grant Morgan
• GST – Don't raise it, take it off food! RAM media release

The Standard supports raising GST

by Auckland unionist The blogsite The Standard operates as an open apologist for the Labour Party. So it is informative, what they have to say, on National's mooted idea of raising GST (Tax reform mustn’t be a gift for the rich). After a long winded argument, they end by support for raising GST, as long as it is offset with an income tax cut of $1000 which they claim would counterbalance the increase in GST. According to The Standard: "There ought to be no reason why the Left couldn’t support that." Concluding: "It is the nature of the complete package that is important." The Labour Party's continuing solid backing for Roger Douglas's flat tax is due for a good shaking up. If the Maori Party's proposed bill is pulled from the ballot, it may be the political earthquake that starts the plates shaking on the shelves. Hopefully a good number will fall off.

RAM elects co-leaders and candidates, runs People's Procession to Parliament

RAM - Residents Action Movement Media release 3 September 2008 The Residents Action Movement, better known as RAM, today elected Oliver Woods and Grant Brookes as co-leaders of their candidates group. Mr Woods, a 20-year-old university graduate in politics, was formerly deputy chair of the Labour Party's electorate committee in Epsom. Several weeks ago he was elected co-chair of the Student Representation Committee at Auckland University for 2009. Mr Woods, who speaks Spanish and Mandarin, is standing for RAM in the Auckland Central electorate. "I'm a social justice advocate," said Mr Woods. "Last year, I chaired public meetings during RAM's Voices of Peace campaign which put a stop to hate attacks on New Zealand's peaceful Muslims. Now I'm promoting RAM's campaign to axe the unjust GST tax from food." Mr Brookes, a 40-year-old university graduate in science and nursing, is a nurse at Wellington Hospital. He is the hospital's national delegate for the NZ Nurses Organisation, representing 1,500 health workers on the union's National Delegates Committee. Mr Brookes is RAM's candidate for the Wellington Central electorate. "I've spent 15 years campaigning for the grassroots," said Mr Brookes. "That's why I'm organising the Wellington leg of the People's Procession to Parliament, a two-week journey through North Island centres with RAM's GST-off-food petition." The People's Procession starts on 20 September in Kaitaia and finishes on 3 October at Parliament. Here the GST-off-food petition will be handed over to MP's from the Maori Party, the only party in the current parliament which supports the removal of tax from food. So far, the GST-off-food petition has been signed by 20,000 Kiwis. "I expect that number to rise considerably during the People's Procession to Parliament," said Grant Morgan, the procession's national organiser, who is also RAM chair. "RAM's campaign to remove GST from food is hugely popular at the grassroots. So many people were queuing to sign the petition outside supermarkets that I was asked by a TV journalist if RAM was holding food demonstrations." "RAM isn't just another electoral party. We are a people's movement which constantly campaigns around issues like GST off food while we also stand in elections. At our petition stalls, thousands of people have told RAM that they are worried about prices outstripping their income. They also say they're sick of being treated as invisible by Labour and National. Both these parties look after the rich. That's why we call them the LabNats," said Mr Morgan. RAM first arose in Greater Auckland as an organiser of the Rates Revolt against the regional council's massive home rate hikes in 2003. In the five years since its birth, RAM has campaigned for free and frequent public transport, for solidarity with low-paid workers and against hate attacks on New Zealand Muslims. RAM won 100,000 votes in Greater Auckland's 2007 council elections. In March 2008, RAM decided to go nationwide and to stand for Parliament as well as councils. In the six months since then, RAM has gained 3,000 members in the country's fastest political recruitment drive. Today RAM elected a list ticket of 26 candidates for the 2008 General Election. Eleven of them are also standing for electorate seats in Whangarei, Auckland, Rotorua and Wellington. RAM's party list rankings: Oliver Woods (Auckland Central) Grant Brookes (Wellington Central) Roger Fowler (Mangere) Elliott Blade (Maungakiekie) Michelle Ducat (list only) Martin Kaipo (Whangarei) Cordelia Black (list only) Stephen Cooper (North Shore) Daphne Lawless (New Lynn) TK Khan (Roskill) Grant Rogers (Rotorua) Don Archer (list only) Pat O'Dea (Papakura) Bronwen Beechey (list only) Robyn Hughes (list only) Rafe Copeland (Epsom) Michael Lai (list only) Curwen Rolinson (list only) Peter Hughes (list only) Dave Colyer (list only) Kyle Webster (list only) Sam Richardson (list only) Tom Pearce (list only) Len Parker (list only) Jonathan Williams (list only) Peter de Waal (list only)

Union members flock to sign GST-off-food petition

EPMU and SFWU members sign RAM's popular GST-off-food petition at a mass union meeting in Manukau. 250 signatures were collected in short time.

People were very interested in RAM's new leaflet advertising the Greater Auckland stopovers of the People's Procession to Parliament.

To get copies of People's Procession leaflets email grantmorgan@paradise.net.nz

Maori Party call to address food poverty

Maori Party media release Tariana Turia, Co-leader of the Maori Party 26 August 2008 The dramatic 7.6% rise in food prices announced yesterday by Statistics NZ is but another factor in the hardship being endured by more and more New Zealanders says the Maori Party. "It is the basics that are hurting our families the most" said Mrs Turia. "We're not talking about luxury items - families have suffered price hikes of 89.4% for butter; 19.6% for bread; 59.3% for cheddar cheese; and 10.2% for milk ­ core items in the weekly shopping basket". "But the biggest worry has been the impact of a 3.6% increase in fruit and veges ­ an increase which low income families have been struggling to meet over this long winter" said Mrs Turia. "All the research tells us that under the persistent pressure of other costs such as fuel and housing, people are being forced to make a choice whether healthy food is worth it" said Mrs Turia."Massey University's Dr Emma Dresler-Hawke and Otago University's Professor Jim Mann have both come out with independent studies, concluding that if Government wants to make healthy food choices affordable, they must give serious consideration to removing the GST off food". "The Maori Party supports the call from the Public Health Association and the National Heart Foundation for GST to be removed from the nutritious basics of the New Zealand diet ­ fruit, vegetables, milk". "The excuses put forward by other parties, that it would be administratively challenging, or would involve some investment ­ are just excuses" said Mrs Turia. "If we are seriously concerned about the health and wellbeing of New Zealanders ­ and the Maori Party is ­ then taking GST off the basic food elements of the household grocery list ­ is an easy way to make a difference" said Mrs Turia.

Fastest growing party registered by Electoral Commission

RAM media release
30 July 2008

Yesterday the Electoral Commission agreed to register RAM - Residents Action Movement. (See EC email below.)

RAM is the fastest growing party in New Zealand. We have gained 3,000 members since late February 2008, when RAM decided to switch from being a Greater Auckland local body coalition to being a countrywide people's movement that contests parliamentary elections.

On average, RAM has gained 150 new members every single week since we decided to go countrywide. Not even the Big Two parties, Labour and National, can claim this recruiting success.

"At our RAM tables, the grassroots are telling us how worried they are about meeting their bills, and also how upset they are that both Labour and National are only looking after the rich people," said Grant Morgan, chair of RAM.

RAM will be fielding a long party list in the 2008 General Election as well as standing in a significant number of electorates.

RAM has issued our Ten Commandments - ten policy priorities - which offer immediate "common sense" improvements in the lives of grassroots people.

Heading the Ten Commandments is our call for GST to be removed from food. RAM's GST-off-food petition has already attracted 20,000 signatures. We will be taking the petition to MP's in a two-week People's Procession to Parliament in late September/early October.

"The People's Procession to Parliament will be a chance for the grassroots to get a fairer taxation system as well as having their voice heard in the election campaign, which is usually dominated by spin from the big political machines," said Grant Morgan.

For more information, contact:

Grant Morgan
Chair of RAM - Residents Action Movement
021 2544 515
grantmorgan@paradise.net.nz


See RAM's TEN COMMANDMENTS