'Kelvin had it right' - Paula Bennett teases over Labour's U-turn

Paula Bennett has teased Kelvin Davis over Labour's U-turn on its tax plans, pointing out he was right all along to say Labour wouldn't introduce a capital gains tax before the 2020 election.

Two weeks ago on The AM Show, the Labour deputy leader said if the party's proposed tax working group recommended a capital gains tax (CGT), the Labour would "campaign on it in the next election".

At the time that wasn't Labour's policy, and his boss Jacinda Ardern made that clear in a public dressing down. She told Newshub that afternoon a Labour government would be free to implement the recommendations of the tax review, including any recommendations on new capital gains taxes, as soon as possible.

But after National used that uncertainty to launch a series of attack ads, on Thursday Labour kicked any major tax reform back to after 2020.

Appearing on The AM Show alongside Mr Davis on Friday, Ms Bennett got stuck in.

"Kelvin had it right - he said that a couple of weeks ago. You had it right. She should apologise to you," the Deputy Prime Minister told the man who's trying to take her job.

"She made a big deal out of it, she repeated it consistently, it was a way to make Labour look strong... then at the sign of a poll that's moving around, backtrack, backtrack, backtrack. That is not leadership, actually, that is not decisive."

Attack ads just 'lies' - Robertson

Labour finance spokesperson Grant Robertson, also appearing on The AM Show, defended the U-turn - saying Ms Ardern had a "sense of urgency about addressing the housing crisis", but had listened to public opinion.

"They've been making up a whole lot of lies about Labour's tax policy, and that's pretty distracting," he told host Duncan Garner.

"This is actually about, how do we make sure that the work that we need to do gets done to make our tax system fairer, but that we also give New Zealanders certainty? There's no problem with listening to people, is there?"

Mr Davis said his boss had been "open and transparent".

"We realised we needed to take things to the electorate in 2020, so we're happy with that. Of course, the country will be able to vote on any decisions."

National's advertising in the last week has heavily focused on claims Labour is planning to increase income taxes, which Mr Davis and Mr Robertson say is untrue.

Claims on National's Twitter account include that Labour will "remove $1060 from the pay packets of middle-income earners".

According to Treasury's Budget calculator, National's tax cuts will actually leave a worker on the median income of $48,800 (according to the Government's careers website) better off by $660 a year.

Under Labour's plan, a single person on the median income without children won't get any extra cash in the hand. But the party's proposed families package promises huge cash injections for anyone with kids.

For example, a person on $48,800 with two kids aged between three and 12 will get $6500 more; if those two kids are under two, this bonus rises to almost $10,000.