Yesterday Labour was forced into a flip-flop over taxes. They’ve promised no new taxes until the after the next election. There are several caveats though.

The first is that the seven taxes they’ve already announce stand…so no new taxes means no new taxes except these ones…

Labour’s undefined tax policies left them vulnerable to National attack ads which warned of seven new taxes or tax hikes. Based on the most recent polls National’s strategy appeared to be working.

Now that Labour has backed down on implementing any previously unannounced taxes in its first term, what’s left of those seven scary taxes?

• Capital Gains Tax
• Land tax
• Inheritance Tax
• Water tax
• Income tax
• Regional fuel tax
• Emission trading scheme

 

Labour finance spokesman Grant Robertson today kicked the first three into touch further than an Otago full back with the southerly behind him.

Capital gains tax, land tax and inheritance tax – All are politically difficult to sell but Jacinda Ardern had made a “captain’s call” to leave them on the table for its tax working group.

By guaranteeing that none of those working group recommendations will be implemented until 2021, they are effectively gone for his election cycle.

The water tax – Scaring farmers up and down the country – stays. But given farmers aren’t big Labour voters and polls have shown broad urban support that shouldn’t dent Labour’s potential vote.

Income tax – It was always debatable as to whether that should have been on National’s list. Labour has been up front about reversing National’s tax cuts which take effect next April.

But because they’ve already be passed as legislation National says this represents a tax hike. Whether this is legit or semantics is likely to depend on your political leaning.

Regional fuel tax – This stays although its only ever applied to Auckland. Mayor Phil Goff campaigned on this issue but National wouldn’t legislate to let him do it. The money would be used to fund Auckland transport solutions.

Emission trading scheme (ETS) – We’re paying for climate change whether we like it not and both Labour and National have signed up to a global agreement on this. But National has exempted agriculture as an industry of national importance. Labour says it will bring farmers into the ETS by the end of their first term.

Then there is the track record of politicians who have pledged no new taxes.

So, when a politician comes at you and promises that there will be no new taxes or no increases in existing taxes there is a good chance they are lying.

Never trust a politician who is promising no new taxes or no tax increases. They simply cannot be believed.

What needs answering now…is if they’ve cancelled all their new planned taxes, then how are they going to pay for all their promises?