Wednesday, November 29, 2023

National's giveaway politics

We already know that national plans to boost smoking rates to collect more tobacco tax so they can give huge tax-cuts to mega-landlords. But this morning that policy got even more obscene - because it turns out that the tax cut is retrospective:

Residential landlords will be able to claim back tax that they paid under the previous Government, the National-Act coalition deal indicates.

Such a retrospective law changes would be “highly unusual and unorthodox,” says one tax expert. Retrospective law-making is generally frowned upon.

And it’s one more oddity in all the toing-and-froing by lawmakers over the residential landlords’ tax break.

Today, CTU economist Craig Renney releases a report concluding the lost revenue cost of accelerating the restoration of interest deductibility will be about $900 million for the new Government – that’s on top of National’s original $2.1b costings, and a new hole in its tax package.

It is unclear whether landlords will be required to give a retrospective rent cut to their tenants, but... probably not.

This is a perfect example of National's giveaway politics, and how lobbying for such giveaways, whether financial or regulatory, is the true business of New Zealand "business". Landlords are getting a giveaway. The fossil fuel industry is getting a giveaway. The cancer industry is getting a giveaway. Farmers and polluters are getting a giveaway. Shitty foreign "gig economy" businesses are getting a giveaway. Seabed miners are expecting one. Even favoured charities are getting one. Meanwhile, actual people who need help or government services like housing, health, and education get nothing. The problem for National is that the latter vote, while businesses don't. But maybe they'll try and "fix" that too?