Ardern defends tax, super policies

Jacinda Ardern. Photo NZ Herald
Jacinda Ardern. Photo NZ Herald
Labour leader Jacinda Ardern has defended last week’s tax policy backdown, saying she had put her case and the public had put its case back to her.

Labour finance spokesman Grant Robertson and revenue spokesman Michael Wood released a revised tax package which said any potential changes would not come into effect until 2021.

There would be no new taxes or levies, except those already announced. Those included a regional fuel tax, a clean water royalty and a $25 levy on international visitors.

The backdown included not implementing a capital gains tax in the first term of a Labour-led government, the removal of a land tax underneath the family home and no inheritance tax.

Ms Ardern understood the need for urgency to fix the housing crisis, and the fairness issues on tax, but there also needed to be certainty.

"I knew I could find that balance between the two by moving by a matter of months the time the legislation would come into force into the next tax year in 2021."

Speaking on TVNZ1 Q+A yesterday,  Ms Ardern said she would go to the electorate saying: "This is the thing I’ve made the decision on. This is the thing we will legislate on.

"But I also have to show leadership in listening to what people tell me. The message came back loud and clear — we get your passion around this. We understand it but we want to know. I have found a balance."

Pushing out the time meant a balance between the urgency she felt with the feedback the public strongly gave her, Ms Ardern said. If it took a few months to find the balance between the two, it was the right thing to do.

Ms Ardern also reiterated her pledge not to  increase the age of superannuation entitlement past 65. National plans to progressively increase the age to 67 years between 2037 and 2040. Everyone born on or after January 1, 1974, will be eligible for NZ Super from age 67.

Ms Ardern previously said she would resign if the superannuation age was raised.

"We’ve stuck with 65. Again, that’s a matter of certainty for people. My agitation with the National Government, particularly when they announced the increase in the age, which Bill English has described as a gift to my generation, was they did that in the face of never having contributed to the superannuation fund.

"They’ve forgone $5.9billion and that includes the cost of borrowing to invest. That’s my criticism."

Ms Ardern said she could not deny superannuation to the one-third of New Zealanders who were in hard-labour jobs when they reached 65.

One worker went to her and thanked her for making the decision.

The issue of paying for that person’s healthcare in 20 years’ time came down to priorities, she said.Labour had made the decision if it wanted to make sure health spending, based on population changes, based on inflation was available, it could choose not to do things such as tax cuts. The health of people could be a priority as well as giving them certainty about retirement, Ms Ardern said.

Seniors Minister Maggie Barry said life expectancy had increased by 12 years during the past 60 years, including by four years since 2001, when the age for NZ Super was increased to 65. It was fair to increase the age of entitlement in 20 years’ time to ensure super stayed on a firm footing. 

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