Bill English MP
National Party Finance Spokesman
30 September 2008
Cullen puts any future Labour tax cuts in doubt
National Party Finance spokesman Bill English says Helen Clark’s promise of a ‘pay jolt’ in education coupled with
Michael Cullen’s comments that he is beyond his comfort zone, clearly mean Labour’s future tax cuts are in doubt.
“Dr Cullen has already said the pre election update is ‘beyond his comfort zone’. Alongside Helen Clark’s potentially
expensive spending promise, these comments indicate Dr Cullen's fiscal outlook is under pressure from Labour’s urge to
spend its way to the election.
“National has structured its credible economic package to take account of the changing international climate. Our tax
cut programme will not require any additional borrowing. National fundamentally sees tax cuts as a way to promote growth
and provide the right incentives for people to get ahead through their own efforts.
“But worryingly, the recent comments from the Finance Minister have an eerily familiar ring to them. New Zealanders
won’t easily forget he cancelled the ‘chewing gum’ tax cuts that were promised before the 2005 election because of
Labour’s overspending.
“At that time, Dr Cullen warned that Labour’s big spending plans would keep interest rates higher for longer. He pleaded
for restraint from his colleagues, but ended up cancelling the tax cuts with the excuse that New Zealanders weren’t
grateful enough.”
Mr English says this shows that Dr Cullen can not be trusted to deliver on any future tax promises.
Mr English says National has long been an advocate of placing more trust in taxpayers to make more decisions with their
own money.
“Let’s not kid ourselves. Despite the begrudging election year tax cuts, Labour thinks it can spend taxes better than
taxpayers. If Dr Cullen is really outside his comfort zone, it’ll be Labour’s future tax cuts that are first to get the
chop.”
Mr English says National will have an ongoing programme of personal tax cuts. It will be a responsible programme, and a
transparent programme.
“National will build on the tax cuts due to kick in tomorrow. We will treat them as the first tranche in our tax-cut
programme. That will be followed by another tranche of tax reductions on 1 April 2009, and further tranches in 2010 and
2011.
“We will be disciplined with the taxes that New Zealanders pay, and will make more effective use of existing spending,
with a clear focus on the delivery of frontline services.
“The same cannot be said of Dr Cullen, who has been a fair weather Finance Minister. He has spent the windfall gains
from the commodity boom, but failed to future-proof economic growth.”
ENDS