Tax should close the inequality gap between people who own and people who earn: Greens

The Labour Party has moved towards more progressive income tax, but is not addressing the growing wealth gap and inequality in Aotearoa. Labour’s new revenue policy also doesn’t help pay for the necessary response to the COVID-19 crisis, Green Party Co-leader James Shaw said today.

“What is being proposed by Labour is long overdue, but it is tinkering that won’t address the long-term challenges facing Aotearoa. It shows the importance of having the Greens around the table of the next Government.

“New Zealand has increasing poverty and inequality. This is now getting worse, because the COVID-19 response is increasing the wealth of those who own property and shares, whilst the median income of working New Zealanders is falling.

“The Greens believe we should ask those who are benefitting the most to chip in a bit of what they’ve gained to help the people who need support during this crisis.                                                                                                                                                                               

“We know that a huge accelerator of this inequality is our broken tax system that taxes people who earn but not people who own.                                                                                                                                                                                

“Currently the lucky few are amassing wealth and do not have to pay taxes on those assets, meanwhile everyone else is finding it harder to pay rising rents and bills, or put food on the table.

“Having already ruled out the Capital Gains Tax, locking out any taxes on assets, property, or wealth locks in poverty and structural inequality.

“Many New Zealanders will understand the clear solution that exists to address poverty and will be hugely frustrated by the refusal to engage in solutions to address inequality.

“We are in the midst of a global pandemic. A lot of us are struggling whilst people who are already wealthy, are getting wealthier.

“If New Zealanders want economic policy that will ensure that everyone pays their fair share to create a fairer New Zealand, and to raise revenue for strong public services through the COVID response, they should make it known on Election Day.

“Taxing of pollution and those who profit from our shared natural resources, like water, is essential to build a more environmentally sustainable economy.

“The Greens’ tax plan is a roadmap towards a fairer, more equitable Aotearoa. With the Greens in Government, we will push for taxation policy that truly addresses the challenges we face, so everyone can live with dignity”.

The Green Party’s Poverty Action Plan would:

  • Implement a wealth tax for those with a net-worth over $1 million. This is likely to raise around $7.9 billion in its first year, and would pay for a dignified Guaranteed Minimum Income of $325 to all unemployed or underemployed New Zealanders.
  • Add two new top income tax bands for a more progressive tax system that redistributes wealth, set at 37% on income over $100,000 and 42% on income over $150,000.
  • Close multi-national corporation tax loopholes.

Labour’s Revenue Policy would:

  • Introduce a new top tax bracket of 39% on income earners above $180,000.
  • Close multi-national corporation tax loopholes.