Government should reduce anti-growth impacts of regulation and tax.Pause introduction of new regulations, cut taxes and redirect wasteful spending.COVID-19 measures must be time-limited. A crisis should not be used to hide permanent reforms.
“The Government’s response to the economic impacts of COVID-19 must be to ‘first, do no harm’”, says ACT Leader David
Seymour.
“It is inevitable that the Government will spend more to stimulate the economy, but its first step should be to avoid
the anti-growth impacts of regulation and tax.
“Instead of keeping taxes at current levels only to give it back to New Zealanders, the Government should allow workers
and businesses to keep more of what they earn, with lower tax rates across the board for the next 12 months. ACT
proposes the following tax rates:10 percent on income under $14,00015 percent on income between $14,000 and $48,00025 percent on income above $48,00025 percent company tax rate.
“Cutting taxes for the next 12 months will preserve jobs and promote economic activity at a time of massive uncertainty.
“The Government should also delay by 12 months the introduction of any non-coronavirus-related regulations to avoid
adding to the cost and uncertainty of doing business.
“This includes next month’s minimum wage increase and proposals such as new tenancy laws and freshwater regulations.
“ACT and a chorus of economists have said for almost two weeks that the minimum wage increase must be delayed to
preserve as many jobs as possible.
“Corporate and middle-class welfare should be redirected to help struggling businesses and workers. Spending $5.6
billion on Fees-Free and the Provincial Growth Fund was bad enough in good economic times. That money must instead be
redirected towards preserving jobs. This will have the effect of reducing the amount the Government needs to borrow.
“We accept that government expenditure will rise during this crisis, but it must return to pre-crisis levels as soon as
possible.
“COVID-19 must not be used as an excuse to permanently expand the size and scope of government.”