Chris Hipkins tears into National over report of dumped tax policy

  • 04/08/2022
"It's the sort of disarray we got used to in the days of Bridges, Muller and Collins."
"It's the sort of disarray we got used to in the days of Bridges, Muller and Collins." Photo credit: Getty Images.

Labour's Chris Hipkins has torn into National, claiming it is suffering "internal division" after a report suggested the party had dumped its earlier tax policy.

National finance spokesperson Nicola Willis told NZHerald it was a policy for the Budget in May and that National would form a new tax policy ahead of next year's election.

However, Willis has confirmed that will include a form of indexation and the party is committed to tax reduction.

A calculator on the party's website which showed how much people could save under its tax policy has also been removed. 

"As we shape our tax policy for the future, New Zealanders can expect to see a package that really focuses on the squeezed middle of New Zealanders who we know are struggling to get ahead and the shape of that package will be determined next year," Willis told NZHerald.

Prime Minister Jacinda Ardern, speaking from Auckland on Thursday, wouldn't get into National's policies.

"The policies of the Opposition are a matter for them and whether or not voters feel they are consistent and therefore trustworthy is also a question for them too."

But one of her senior MPs was more than happy to.

Hipkins, who released a statement on a Labour letterhead as the Labour MP for Rimutaka (as opposed to as a minister), said National appeared to be "in disarray".

"This was Chris Luxon's first policy as National Party Leader, and now his Deputy Nicola Willis has dumped it six months later," he said on Thursday. "It's the sort of disarray we got used to in the days of Bridges, Muller and Collins." 

Willis says the party's position on indexation has not changed.

It comes just a day after Luxon was forced to clarify comments about National's health and education spending plans. 

After previously promising to lift spending by the rate of inflation, Luxon wasn't so clear about it during an interview with AM on Wednesday morning. He later told reporters that it was National's policy to peg spending to inflation.

Hipkins pointed out Luxon's comments on abortion, businesses being soft and his social media account suggesting he was in Te Puke when he was actually holidaying in Hawaii as "rookie errors". He questioned whether National MPs might be asking whether the first-term MP was promoted to leader too soon.

"Luxon's puppet at the Backbencher might be Humpty Dumpty but one has to wonder if the Fosbury Flop might have been more accurate," said Hipkins.

National's plan to index tax thresholds to inflation has been criticised as likely being inflationary. It would pump more money into the economy, without the party clearly addressing where any cuts would come from, opponents argue.

Willis last week disagreed.

"No, the Treasury has been clear that Government spending adds more to inflation than tax reduction. Our proposal for tax reduction is that it's permanent," she said.

"It's something that people can rely on, not just a temporary band-aid that will get ripped off all too soon."

She's referencing the Government's cost of living payment that wasn't recommended by Treasury. Officials were concerned "a broad-based one-off payment of this magnitude would add to inflationary pressures in the short-term". 

However, Treasury did acknowledge that the "risk to longer-term inflationary pressures is relatively small assuming any interventions of this nature were temporary".