The ACT Party has released its Tax policy, as part of their recovery package and response to help New Zealand get out of the current economic woes.
Leader Rodney Hide has labelled both Michael Cullen and John Key's weak responses to the economic problems as "irresponsible". Hide says Cullen wants to spend money the country doesn't have.
He's also labelled Key's plan to force the Government Superannuation Fund (the "Cullen Fund") to over-invest in New Zealand's limited number of companies and other assets as "nuts". Hide notes that even diehard socialist Michael Cullen isn't supporting the idea of a 40% NZ investment requirement, which which shift ownership from private hands to the State (an idea backed by the Greens & NZ First).
ACT has already said it wants to see Cullen's 39c "envy" tax rate gone by Christmas, and has unveiled a more ambitious tax package than the decidedly wimpy version released by National's John Key earlier this month.
ACT's Rodney Hide and Roger Douglas say personal tax brackets have not changed in the last 10 years (the Helenban years) to reflect inflation, which means by next year New Zealand households will be paying an extra $230 a week on average to the Government.
The ACT Party's plan is to reduce the bottom tax rate to just 12.5% in 2011, while moving to a flat rate of 15% Personal tax over the $20,000 mark over the next ten years.
GST would be trimmed back to a simpler 10%, and Company Tax would be slashed to 15%, allowing New Zealand to be more competitive with Australia and other countries, and increasing the incentive for much more investment. There would also be Petrol Tax cuts of around $500 million.
For those New Zealanders who want choice and the chance to have more control of their own lives, ACT is proposing an Optional tax-free threshold of $25,000 a year. That would create a saving of $3,050 in tax for people who want to opt out of State-provided ACC/sickness/healthcare.
A grant to cover ACC/sickness/healthcare would still be provided for any dependents, along with educational scholarships for dependent children. (Both the tax-free threshold and grants would be adjusted annually for inflation).
Unfortunately the party is a little less ambitious when it comes to cutting out-of-control Government spending. ACT want to hold future expenditure increases to 3.6% (inflation level), rather than the 6% of recent years.
The party's "20-point plan to beat Australia" does include plans to cut the number of bureaucrats and pointless Government departments, but the restrained policies on Government spending are still some way short of what ACT's more "libertarian" members would have liked to have seen.
However, ACT is promising to dump Labour's dodgy Emissions Trading Scam, which panders to the Greens and to Hillin Cluck's ambitions of a top job at the United Nations.
ACT would repeal the Emissions Trading Scheme and pull out of Kyoto... saving New Zealand billions of dollars and many thousands of jobs, by rejecting the false religion of "man-made Climate Change" and "Global Warming" and its One-World tax called "carbon credits".
Posted at 8:42 pm