Here's What I Think
[Unfinished notes - please email me on this topic if you wish to contribute.]
So much spin on tax equality! If everyone's earnings go up by 10% then the gap between the top quartile and the bottom quartile opens out by - you guessed it! - 10% - but so often we hear about the need to maintain equality - that is just pure spin. Of course we need to be fair - but the critical need is to increase the purchasing power particularly of low income earners.
What do we really want to do? We want every kiwi earner's income to be at least as good as they could get in Australia. If less tax would mean that kiwis would work harder because they get to keep more of their own pay that would be great! But we already work harder than most OECD countries!
So we need to work smarter - not harder.
This is where ICT comes in - we need to be cleverer about how we manage our businesses.
We need shared services in all areas which do not give us competitive uniqueness.
We need to use wikis to build the best knowledge sources we can in our patch.
We need to do business process management studies on all our existing practices to ensure they are the best.
Economic Transformation needs to be our goal!
We need to get rid of hierachial management structures. New ways need to be built on what everyone knows. It is called Collaboration and is enabled by wikis. It has always been a trait of kiwis - and is certainly an expectation of our Gen-Ys.
Where should eldery people put their retirement savings?
Why not allow people whose only other income is Superannuation to leave their savings in a NZ bank and not have to pay tax on the interest. After all they have just been careful as we would like them to be!
Perhaps cap it at $250,000 which may be enough to give $20,000 pa extra income for 20 years of retirement (if the banks pay close to current rates and inflation is under control).
Or perhaps if the Government is going to give Shared Equity for new houses what about giving Reverse Equity on superannuitant's houses?
If the tax rate goes over 25 cents in the dollar taxpayers (and lawyers) start spending time in tax avoidance schemes. [Source?]
So keep the top rate below this!
Then keep the corporate rate the same so there are not complex legal devices to move income between companies and individuals.
And finally get rid of the existing Loss Acquiring devices - then less money would be diverted into rental real estate - upsetting the Governor of the Reserve Bank - who then puts up interest rates and punishes us all!
Just keep it really simple!
2008 - Ian Mitchell
22A Goldie Street St Heliers, Auckland, Ph: 09 5851580