Wealthy support taxes on high wealth and a higher tax rate on top incomes: Equality Network
The Equality Network
Embargoed until Tuesday 22nd August: 4am.
Tax experts and the wealthy themselves are among those supporting the call for a tax on high wealth and for a higher tax rate on top incomes.
Graham Robertson, Canterbury-based philanthropist, National President of Closing the Gap, and farmer, says he agrees that tax levels on higher incomes need to be raised, and wealthy people like himself who can afford it need to contribute more.
“Many of my friends and colleagues, particularly those who are comfortably off, are offended by the shortfall in government funding for children living in poverty and I am too. The task is too big for the voluntary agencies to plug the gaps.”
“I know tax is an important economic lever and we have to be careful not to strangle initiative and enterprise by over-taxing,” says Robertson. “But other countries with similar open economies do have more comprehensive tax on high wealth and higher tax rates on upper income levels without sacrificing economic performance.”
He says that in a more equitable society, everyone, including wealthy people are better off. “It is well documented by the authors of The Spirit Level (Wilkinson and Pickett) and other academics that all people in a more equal society are better off; including the rich. In other words the rich are better to trade some of their wealth, through increased taxes, in order to create greater levels of equality. “
“The mark of a successful economy is the way in which the poor are treated and NZ is not a good place for our poor, especially if they are homeless. We must face up to the fact that we who are better off should pay more tax.”
According to Professor Lisa Mariott, School of Accounting and Commercial Law at Victoria University of Wellington, New Zealand needs to change the way it taxes people to be in line with best practice. She says our top tax rate is considerably lower compared to those in other countries.
“Our top tax rate currently sits at 33 per cent compared to UK and Australia where the rate is 45 per cent. If we raised this top tax rate for those earning well over $100,000 it would mean more resources to reinvest in health, housing, education and social services – so all New Zealanders can prosper.”
She says that now is a good time for New Zealand to consider a wealth tax. “In relation to taxing wealth, NZ is quite unique in not having any form of wealth tax.” She says that in New Zealand, just 1 per cent of the population holds a whopping 20 per cent of the wealth, while the bottom 50 per cent hold less than 1 per cent. “By taxing wealth we can create a more equitable New Zealand.”
The Equality Network, a non-partisan organisation of 37 members united by the vision of the a vision of a more equal Aotearoa New Zealand, is asking for politicians to consider immediate changes to the tax system including a higher tax rate for the highest incomes and introducing a tax on high wealth.
Equality Network member Oxfam’s recent publication, the Commitment to Reducing Inequality Index, looks at the tax structure, the impact of tax on inequality, and potential tax revenue available of 152 countries.
Paula Feehan, Advocacy and Campaigns Director at Oxfam, says that in New Zealand ranks 115th out of 152 countries in terms of the progressivity of its tax policy.
“The index demonstrate that Governments have considerable powers to take away the barriers to getting ahead and create fairer opportunity for all to share in our country’s prosperity, and that only by focusing on concrete steps to rebalance incomes and wealth that can we end extreme poverty,” says Feehan.
She says that by changing our tax system through introducing a higher tax rate for top incomes and by creating a tax on high wealth we can help to create a more equal country.
“New Zealand must do more to build a fairer, more progressive tax system to tackle inequality. We think most New Zealanders want to see an end to extreme inequality, and want an economy that works for everybody, not just the lucky few. What we’re saying is that the Government can – and must – act to create a fairer society and to end extreme poverty.”
More information on Oxfam’s report can be found here.
For more Equality Network resources, including two videos on tax by Professor Lisa Mariott, click here.
Photo of Professor Mariott, as well as Equality Network images and the Equality Network election statement can be found here.