I suggest middle class is a wide band. The top tax rate starts at 60K. Fact. Your example relies on both parents working, or one to be significantly hinger than 60K. My point was exactly that - it requires both parents to be working.

To put it another way, it is just as silly to define a single income earner with a family on $80K, living in Auckland, as in the same category as those on 200K. Maybe we could compromise, and move the 60K to 110K and allow income splitting?

The incentive for a Mother to stay at home and look after her children, even if the father is on 60K is such that it is hardly an option. Indeed, if he gets a 10K rise the extra dosh is effectively taxed at 51% (39%+12.5%), so there is less incentive for him to do better as compared to getting the wife out on a 10K job, which then gets eroded by transport and crèche fees. Rather than complex rebate systems creating paper work, and relying on the tax returns being completed correctly, with screeds more legislation and bureaucrats, moving the tax brackets and/or allowing income splitting would provide fairer tax relief. And every extra dollar in a pocket will still be spent in some way, and therefore taxed as it goes around.

And the deciles sound as interesting as Cullen, redefining his 1999 statement that only 5% of taxpayers would be paying the top rate. What he could have more truthfully said is that 22% of the workforce are paying the top tax rate. He apologised for that a few days ago I believe.

My opinion still stands - Labour seem to be trying to make out the folks on $80K should consider themselves bloody rich and bastards for complaining about paying not only more tax in pure dollar terms, but then compounding that by also upping the percentage taken at the same time.

The policies are reflections of equalisation by bringing mid range people down, whilst making out these people are the fat cats. In terms of the ACTUAL taxation burden, we could show more respect to these people instead of trying to make out they are rich, greedy sorts.

No, I don’t say that. I say that Percy should say that to be consistent.

Your argument is that this (but not tax cuts) are a bribe because “someone has to pay the interest”, as if tax cuts have no cost. The costs of tax cuts are, likewise, spread across the country in less govt health care, poorer education, etc.

Zen,

A two income family with over 60k each (or with one of the two incomes significantly over 60k, ie paying a significant amount of the top tax rate) is almost certainly in the top 10% of households by income (top decile starts around $110k, from memory). That might be “middle class” in your view - but if so the majority of New Zealanders aren’t rich enough to be “middle class”.

The marginal effective rate of tax is computed by working out the benefits withdrawn as well as the tax paid, and it hits 90% for a wide range of mid to upper middle class incomes and then DROPS to 40% or so on all the money made from 70K to the sky.

This is exactly the target range (parents and students) which will benefit from the policy, and the 90% rate is so punishing, that they all breath this big sigh of relief to see even a small lift of the pressure put on them. I do NOT want my wife to work, do NOT want to form an LAQC and become a landlord, I just want to do my job, live in my own home and pay a reasonable level of tax compared to someone on a 40K income and someone on a 400K income. That means a rate higher than the guy on 40K and lower than the guy on 400K. That is NOT the case now.

Which is why this is an issue. Labour may have a winner and may get itself re-elected with this small sop to the tax-paying-class, but it hasn’t FIXED the tax problem. It has fixed a problem for students and schools.

The question will be whether the public will understand this in the run-up to the election or whether there are other issues that prevent deeper analysis from being used.

respectfully
BJ

Until then, you just want to make the middle class success mediocre, and force families to have 2 working parents, with “generous” subsidies to encourage Mothers to stay away from their children.

It is, of course, neither. It’s a policy totally in line with Labour’s principles. The party has always believed that access to higher education is a right of citizenship; it is not a privilege dictated by the size of your wallet (or your parents’). So we are taking another major step to make it more affordable, just like we did in 2000.

The cynicism is all the media’s, who seem not to believe that one might offer popular, big-vision policies like this for principled reasons. Go figure that. Just shows how twisted their perspectives are.

And as for National, your cartoon sums it up perfectly. Let’s keep that line up, and keep highlighting the kinds of social investment you can make if you don’t slash taxes for rich people.

You say that by not forcing people to owe something that is not a bribe. I would differ. The cost of this borrowing (the interest) will not go away. As the streets say “A grand don’t come for free”. It will merely be spread across the country as a whole.

Now what I consider a bribe is saying that we will get other people to pay for the cost of your borrowing. Here have some more cake someone else is picking up the tab. In that scenario do you think anyone will stop eating the cake? Hell no, they would be stupid to.

Tax cuts are not a bribe for exactly the reasons Percy mentioned. Promising not to take so much off people is not a bribe.

Because of the paradoxical nature of politics students can thank National. Had National not been doing so well then this policy would never have been introduced.

What puzzles me is this: how come a millionaire can’t spell or construct a sentence?

Though I have noticed you’re more coherent elsewhere: does proximity to frogs befuddle you? Leave your head spinning? If so, is this a symptom of infatuation?

You argue that you can’t bribe people by agreeing not to take money off them which they otherwise would owe. But then by that same logic you can’t bribe people by not taking interest off them.

Please, be consistent.

It isn’t entirely out of line to go into debt somewhat, as that keeps you honest about your prospects of making enough extra to pay it back, education as an investment in yourself, but I want to see adequate funding up front, and less debt being loaded on.

respectfully
BJ