Labour’s Minimum Wage Proposal a Backward Step

Democrats for Social Credit finance spokesperson Chris Leitch has attacked Labour’s proposals to increase the minimum wage labelling it ”a backward step for low and middle income earners”.

“Far from making low wage earners better off, the proposed increase will have the reverse effect and will actually make low and middle income earners far worse off than they are now”, Mr Leitch says.

“What Mr Cunliffe doesn’t seem to realise is that manufacturers, importers, and all employers faced with having to pay the increase will be unable to absorb the increase and will be forced to increase their prices”.

“Just a few of the cumulative effects of that will be :-

1. Prices on everything in the shops will go up

2. Services like taxi, train and bus fares will rise

3. The GST component on everything will be greater

4. To counter the inflationary effect, the Reserve Bank will increase the OCR forcing interest rates up

5. Some low paid workers will lose their jobs, putting more onto social welfare

And there are many more”.

“The effect will be to leave low and middle income earners far worse off than they are already”.

“What Labour should be proposing is scrapping GST and putting in place a transactions tax at a rate of a tenth of one percent (10 cents per $100) on all withdrawals from bank accounts”.

“This would give wage earners an immediate increase in spending power of nearly fifteen percent – far more than Mr Cunliffe proposes”.

“The transactions tax would catch in the tax net, the massive top end market in financial speculation, currency trading and the like, which currently is untouched by the GST regime”.

“Given that New Zealand is the 9th most traded currency in the world, the amount collected from a transactions tax that includes currency trading would be more than the entire GST tax take”.

“Labour should bow its head in shame over a silly proposal that directly makes its traditional voter base far worse off”.

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