The Budget

Okay am now in China, which is rather appropriate considering Labour’s latest budget.

Looking at the key facts for taxpayers, we now have the 11% of people earning over $60,000 paying 48% of income tax. The top 3% pay 25%.

Next year’s surplus is projected to be a whopping $6.7 billion. And remember that Treasury normally under-estimate by $2 billion or so, thus still looking to over-tax by almost $10 billion.

The so called tax adjustments are so small, and not coming in until, get this, 2008. Something is better than nothing, but as John Key said this is squandering a once in a generation chance to make significant reductions in tax. I mean waiting three years for such a piddling adjustment is almost insulting when you look at the forecast surpluses.

Tax revenue is forecast to reach $54.3B under Labour. This is a huge 78% increase over three terms, if they get the chance. Under National it increased only around 3% a year, as surplus funds were returned.

More analysis later.