The SME Stream

National's Nicola Willis refuses to rule out an increase to the ACC levy if she's returned as Finance Minister.

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The National Party has confirmed it's not going to introduce any new taxes if elected for a second term.

Earlier this month, it indicated  it was looking at new bank tax settings and progressing a bed tax, but they've ruled those out.

Finance Minister Nicola Willis says the party was very clear two weeks ago - and they've clarified these new taxes have been ruled out.

"The three parties of the coalition - National, New Zealand Fist and ACT - agreed to explore it, only explore it...and we've come to our campaign position, which is that we will not do it." 

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Labour’s fiscal strategy, debt promises and how it compares with National’s approach. Herald Business Commentator Fran O'Sullivan.  

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Yep, it was all about taxes over the weekend. Labour pinned its colours to the mast over the weekend and wants to tax more to spend more. Taxman from the Beatles was written by George Harrison in 1966 when Harold Wilson came to power in Britain.

He imposed a super tax of 95% on the extremely wealthy, of which the Beatles were on paper, but their accountants warned them they were about to become bankrupt. 95% tax. Labour does not want that in 2026 in New Zealand, but they do want to tax more to spend more.

As Henry Cooke wrote in the Post, Labour is a social democratic party. It wants the state to be a large part of the economy and it wants the state to worry more about employment. They are comfortable with core crown spending and revenue aligning at about 33% of the economy. National wants 30% And you might think, oh, 30 33 what's the diff? Well, the difference between these two targets is not there or thereabouts when you consider every 1% of GDP is worth around $4.35 billion.

So it'll mean two very different ways of managing the country and running the economy depending on who's in charge. Barbara Edmonds over the weekend and Chris Hipkins were speaking to their tax policy and it's good to finally see it because people now know they have a clear choice. We also heard on the Mike Hosking Breakfast this morning the Labour leader outlining exactly how the CGT will work to fund the many promises Labour has made.

Once the capital gains tax is fully implemented, we're expecting government spending as a percentage of GDP to settle at around 33% of GDP. So that is it is higher than what the National Party are estimating. We're not putting a particular we're not setting a deadline for it or anything, but it is a it is an indication that we don't expect to go higher than that.

The 1.35 billion on the CGT based on what? This is still the Treasury 4% number?

No, it's based on a 3% when we when we set out the CGT we set it out at 3% so we were deliberately conservative on that. And it's 3% over time, so obviously with the capital gains tax the revenue in the early years is lower than the revenue you get as the longer the capital gains tax is in place.

That was Chris Hipkins talking the CGT on the Mike Hosking Breakfast. Labour's also promising a return to surplus in the 29 30 financial year while pledging to restore the Reserve Bank's dual mandate so employment levels are considered in monetary policy decisions, which is all very well and good, but didn't help us back when they did have the dual mandate, did it?

Over the weekend National too made their party's position very clear: no new taxes. So no bed tax, which we were discussing last week to help fund regional tourism. No bank tax, despite Nicola Willis announcing a levy on banks in Budget 26 which she said would gather about 200 million over the few years. Over the weekend she said she was concerned and the reason she'd pulled back from announcing that levy tax that any new taxes would simply be passed on to Kiwis. If she taxed the banks they'd pass it on to consumers and she didn't want that.

It's becoming a clearer and clearer choice. Labour wants to tax more to spend more. You have to tax more. Where else are you going to get the money from? And if you tax more you have to hope that they will deliver more because it's all very well and good taking the money, but then it has to be spent wisely and judiciously. National says we can't afford to do much. If we wanted to do more we'd have to tax you more and we don't want to do that. So it means that some of the nice to haves won't be funded.

So do you go with more tax, more spending on the part of the government so they will do the spending for you? Do you want less tax and less money for the nice to haves? Or a pox on both their houses as we've seen in a number of political polls and a vote for the Opportunity Party? Because that's an option too.

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Why long-term US bond yields remain stubbornly high. Shane Solly Harbour Asset Management.

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Is National’s promise of no new taxes as good as it sounds?

If you ask Auckland Mayor Wayne Brown, he’ll say no. Because he’s been pushing for a bed tax for tourists and, yesterday, Christopher Luxon and Nicola Willis announced that that won’t be happening under National.

Wayne Brown won’t be the only person upset, either. You ask anyone in tourism or local government and they’ll tell you that a bed tax is a no-brainer.

But, if you ask the banks, they’ll say no new taxes is brilliant. Because, as well as ditching the bed tax idea, National has dropped the other tax it had been mulling over. Which was a levy on bank profits.

Christopher Luxon says neither of those will happen under National. Because they would have just been passed on to customers. Or “everyday Kiwis”, as Christopher Luxon put it.

We know, though, that the real reason National has dropped these two new taxes is because, being election year, all it thinks about is catchy slogans. And you can’t go bringing in new taxes if your catchy slogan says no new taxes.

But is that approach really what’s best for the country? I don’t think it is. Which is where Labour comes into it. Announcing a few details of its finance plan over the weekend.

At this point, let me remind you of my position on Labour. I think it has wasted the last three years and does not deserve to form the next government.

The latest poll out this morning, though, the RNZ-Reid Research poll, says a small majority of voters don’t feel that way and has Labour on 32 percent and National on 29 percent.

But I think Labour has just coasted since losing the election three years ago and hasn’t come up with any good reasons to give it another turn this time around.

That said, when you compare National and Labour’s approach to taxation and spending and you consider what the country needs right now, Labour’s approach makes a lot more sense.

There are bits that don’t. Such as the free doctor visits for everyone. Which would be paid for, apparently, by Labour’s new capital gains tax. And be available to everyone. Even people who can well afford to pay to go to the GP themselves.

But, when you consider what Labour and National have been talking about over the past 24 hours, it comes down to this: Labour wants to tax more and spend more, while National wants taxes to stay as they are and to spend a bit less.

Your gut instinct might be to go with no new taxes and less government spending.

But is that really what this country needs right now?

As independent economist Cameron Bagrie said this morning, if you want things like better health services, you have to pay more tax.

If you want Health NZ to hire more than just the miserly 54 new nurses it’s taken on over the last two years, do you think we’re going to do that without putting a bit more coin in the tin ourselves? Of course not.

More cops with no new taxes and less government spending? Be honest. Of course not.

That’s why Labour’s tax talk is way more realistic than National’s.

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Some think the India Free Trade Agreement will produce more benefits than even the Government expects.  

The agreement is moving through Parliament, before it's ratified.

The International Business Forum and Westpac have released new research on how the deal will contribute to value.

Forum Executive Director Felicity Roxburgh says it shows Government forecasts of 0.1% GDP growth in the next decade undersell the benefits.

She told Mike Hosking they can't put a good number on it, but India is on track to be the world's third largest economy by the end of the decade.

Roxburgh says their middle class will exceed the entire population of the EU or ASEAN, so it's a big opportunity for New Zealand.

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How often should you review your KiwiSaver — and what should you actually be looking at?

In this episode of The Prosperity Project, we talk through what matters when reviewing your KiwiSaver, from your retirement goals and contribution levels to fees, fund types and provider performance.

Financial commentator Russell Hutchinson explains why you shouldn’t just chase last year’s top-performing fund, how to think about active versus passive management, and why performance after fees is what really counts.

Plus, is checking your KiwiSaver balance every week helpful — or just a distraction?

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Labour's staying tight-lipped on whether it would make more cuts to the public service if elected, but assures it's focused on protecting it.

The party's latest election promise sets out to achieve surplus by 2030, and reduce net debt to 20 percent of GDP over time.

It will aim to keep Government spending and revenue at around 33 percent of GDP once its Capital Gains Tax is fully implemented.

Finance and Economy spokesperson Barbara Edmonds joined the Weekend Collective to outline the plan further.

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Most people think building wealth is about earning more. But what you do with your money matters just as much as how much you make.

In this episode I’m sharing my 9 money habits that have shaped how I’ve built my wealth and how I think about money altogether.

I’ve learned that looking wealthy and being wealthy are two very different things. From refusing to spend $20 on a drink while owning a $300,000 G-Wagon, to realising that chasing more money was costing me friendships - these are the lessons I wish I’d learned sooner.

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