ACT's David Seymour accuses Government of 'tall poppy syndrome witch hunts' with tax investigation

The ACT Party is accusing the Government of "tall poppy syndrome witch hunts" for going on a fact-finding mission to find out what rich people are contributing to taxes.

Revenue Minister David Parker said on Tuesday he believed New Zealand rich listers were avoiding scrutiny and weren't paying their fair share of tax. 

Parker announced a proposed law, the Tax Principles Act, that would include "principles" to assess tax policies against.

A lot of wealth is generated by assets, which in most cases are not taxed, explained PwC tax partner Geof Nightingale.

"In New Zealand, we tax income," Nightingale told AM. "We don't generally tax capital gains and the wealthier you are, the more assets you accumulate and, therefore, the more capital gains you accumulate."

The Government has previously ruled out a capital gains tax and rejected the Green Party's call for a wealth tax.  

But David Seymour, the leader of ACT, still believed the Government was "focused on taxing, redistributing and dividing" with its proposed law.

"Any Government ACT is part of will have no time for envy-fuelled wealth or capital taxes," he said on Wednesday.

"As Labour plant the seed for increased taxation and National is unclear about what they will or won’t rule out, ACT can be unequivocal in its position that we will repeal any taxes proposed by Labour.

"We've got no time for tall poppy syndrome witch hunts designed to strip Kiwis of more money. In fact, if anything the current tax system is unfair."

David Seymour.
David Seymour. Photo credit: Newshub.

ACT and National have both said that if elected, they would scrap the Labour-introduced top tax rate of 39 percent on income over $180,000. 

National Party leader Christopher Luxon told AM the Government should be leaving it up to IRD to hold the wealthy accountable.

"My big takeaway is very simple: Labour wants to increase taxes, National wants to lessen taxes," Luxon told host Ryan Bridge.

"What we support is a really fair tax system - it's important that wealthy people pay their fair share.

"The IRD, today, has powers to go off and audit an individual - make sure that they are paying their fair share… The question is, are we now in a conversation about being anti-wealthy people? Or are we in a conversation about whether we have a fair tax system?"

Christopher Luxon.
Christopher Luxon. Photo credit: AM

Parker said on Tuesday "you can never take the politics out of tax" but believed it was time to "report actual outcomes against settled tax principles" - hence the proposed law.

"Having made my political point and highlighted our very different approach to that of the Opposition, I readily accept you can never take the politics out of tax. We can, though, have a fact-based discussion."