Editorial: Labour's tax clarity is welcome

Labour leader Jacinda Ardern has provided much-needed clarity on tax.
DAVID WALKER/STUFF

Labour leader Jacinda Ardern has provided much-needed clarity on tax.

EDITORIAL: Since her rapid ascension only six weeks ago, Labour leader Jacinda Ardern has promised a "relentlessly positive" election campaign but she should not have been surprised to see her opponents go just as relentlessly negative. 

Fresh from Finance Minister and National Party campaign manager Steven Joyce's discovery of a mythical $11.7 billion "hole" in Labour's finances that no one else could see, National sought to sow further fear and confusion through repeated attacks on Labour's vague tax plans. And it was an attack Labour made all too easy.

Before Ardern's elevation, former leader Andrew Little had proposed that Labour would create a working group to rethink the tax system and the results would be put before voters in 2020 so a mandate could be sought. That was an eminently sensible and reasonable option. Under Ardern, the policy shifted and became less certain with new taxes possibly introduced after the 2017 election. 

A recent announcement from Labour's finance spokesman Grant Robertson has more or less returned the party to Little's position. In doing so, it has neutralised the one area where Labour was vulnerable. 

National has been eager to generate uncertainty about life under Ardern and supporters even coined a derisive nickname – "Taxcinda." A National Party attack ad released on Wednesday subverted Labour's "Let's do this" campaign line into "Let's tax this" and warned of a capital gains tax, a land tax, a regional fuel tax, income tax, water tax and a so-called "fart tax". Even cows were not safe.

Ardern dismissed this as scaremongering but that was not enough and the polls started to reflect that voters wanted certainty. Labour's announcement provided it and has levelled the playing field again.  

Joyce's argument that Labour has only postponed two taxes from the list – a capital gains tax and a land tax – and left five in place reeks of sophistry. A reversal of future income tax cuts legislated by National is not the same as an increase in tax and it is intellectually dishonest of National to keep saying so. 

Other Labour taxes target climate change and polluted rivers, both of which the Government has been slow to act on, while a tax on tourists is a popular way of funding conservation infrastructure. National has already launched a weaker version of it. 

The taxes that have been taken off the table until at least 2021 are ones that experts see as useful tools to correct housing unaffordability. But National knows centrist voters respond to dark threats of extra tax on homes, rental properties, boats and baches. 

With little more than a week to go until polling day, and with increasing numbers already voting early, clarity and truth-telling has become vital. Voters can also compare two different leadership styles. 

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Some commentators saw Ardern's so-called "U-turn" on tax as reminiscent of former prime minister John Key, who could switch 180 degrees if the public mood required it. Unlike Joyce and English, who are still doggedly repeating their story about the $11.7b "hole", Ardern has shown she can back down and change her mind. 

Philip Matthews is a senior writer for Stuff. This opinion piece ran as an editorial in The Press on September 15.

 

 - Stuff

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