By Dan Satherley
With the Occupy Auckland camp as a backdrop, the Mana Party this morning took to Aotea Square to unveil what they're calling their "economic justice" policy.
Spokesperson John Minto, who is standing for Mana in the Manukau East electorate, says New Zealand has had the fastest growth in inequality in the OECD over the last few decades.
To fix this, Mana is proposing to get rid of GST, instantly raise the minimum wage to $15 an hour and make the first $27,000 of income tax-free.
The minimum wage later be pegged at two-thirds of the average wage, so would jump to around $16.50 by 2013.
"We no longer have the situation where low wages are low, and keep on failing to meet the rate of inflation and people get further into poverty," says Mr Minto.
The tax-free threshold – $27,000 – equates to what a person working 40 hours a week on the minimum wage would earn.
Mr Minto says GST has to go because it is "inequitable", and hits the poor disproportionately hard.
"We're not talking about taking GST off fresh fruit and vegetables, we're saying get rid of it altogether," says Mr Minto. "It is a tax on the poor – the poor pay about 13 percent of their income on GST, the wealthy pay about 5 percent of GST on their income… it has to go."
Mr Minto says getting rid of GST would cost $15 billion, which would be recouped through a tax on financial transactions known overseas as the 'Robin Hood tax' and locally, as the 'Hone Heke tax'.
He says taxing speculation on the dollar, for example, would also have the added advantage of stabilising the currency and would bring down the overvalued dollar.
"If the value of our dollar goes down through a tax on speculating, it means our exporters will get greater income from their exports – it's a win-win-win situation," says Mr Minto.
Mr Minto says he's not sure yet what the tax would be, except it would "zero point something of a percentage – very low".
"It's a tax on the 1 percent to relieve the pressure on the 99 percent who are paying all of the tax at the moment."
The separation of people into the '1 percent' and the '99 percent' is an idea lifted directly from the international Occupy movement, but local occupiers seemed disinterested in Mana's announcement. Only a couple bothered to leave the camp to watch Mr Minto speak.
One occupier told 3 News that as a political party, Mana was a part of the problem, not the solution, and couldn't be trusted.
Another detail of the party's economic policy announced today was a simplified progressive taxation system, where all a person's income is counted, no matter its source.
"We have a lot of unearned income which is not taxed at all," says Mr Minto, pointing to capital gains, shares and hidden trusts.
"It is dead simple," says Mr Minto. "All of your income in one pool, and that is taxed at your personal tax rate."
According to Mana's calculations, minimum wage workers would get an instant in-the-hand payrise of $132, rising to $200 once the minimum wage was pegged to the average.
They are realistic, however, on their chances of implementing their economic plans.
"We're not planning to control the Government after the election," says Mr Minto, "but we're planning to have a major influence in the next Parliament, and these ideas we will be fighting very hard for."
He showed a series of charts showing how since the early 1980s, New Zealand wages have stagnated compared to Australia and places the blame for this – and growing inequality – on both the major parties.
"Labour and National policies over the last 27 years have been captured by the 1 percent," he told the crowd. "That 1 percent in NZ has become obscenely wealthy while we have hundreds of thousands of kids living in poverty. We need a dramatic and revolutionary change in our economic approach, and that is provided by Mana."
Party leader Hone Harawira was also present, but took a low profile and didn't address the media.
Other policies announced today:
- Give workers greater bargaining powers to negotiate wages and conditions
- Extend in-work tax credits to beneficiaries
- Regulate loan sharks and restrict banks' profits on loans, credit cards and mortgages
- Regulate family trusts and other 'tax-avoidance' devices
3 News