Fairtax in New Zealand?

Titan's picture
Submitted by Titan on Thu, 2005-12-22 06:08

Does New Zealand have a movement, like we have now in the USA, to get a Fairtax bill passed (national sales tax)instead of income and numerous other taxes?

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Stephen Whittington's picture

New Zealand currently has a Goods and Services Tax (GST) that is 12.5%. When it was introdiced in the 80s, Roger Douglas (the one who instituted many right wing policies - end tariffs, lower taxes, sale of state assets) wanted it to be a higher percentage and replace income tax. This wasn't politically palatable, however, and so didn't happen.

Our furthest right mainstream political party, ACT, which was actually started by Roger Douglas and his sidekick, Richard Prebble (as well as a guy called Derek Quigley) aims for a flat tax. Well, they did in 2002. Their latest policy is a two-tiered tax system of 25% and 15%, eventually reducing it to 15%. They certainly oppose many of our other taxes though. Most Libertarianz - the New Zealand Libertarian party, would consider ACT to be limp wristed in their approach. Roger Douglas wrote a book called 'Unfinished Business' in which he argues for a consumption, or goods and services tax, to take the place of income tax.

As a sidepoint that is a little bit bizarre, the Green Party argue that we need to 'move the tax burden from income to things that harm the environment and society'. I have had heated debates with many Green Party members over tax, and some of them do actually agree that there should be no income tax since it doesn't harm society or the environment. Of course, they'd just tax us to death in other areas.

Hope that helped.

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