Harawira on Agenda

Agenda hve the transcript up of their interview with Mairo Party MP Hone Harawira. First the good parts:

HONE Oh sure, I mean they have, to assume that they can simply sit there and pass an Electoral Finance Act when the whole world was saying this sucks and in fact it’s come back to bite them on the bum shows how disconnected they were with reality to try and ram through legislation at this late stage in the game is arrogant, it suggests that they are really only – and then to stack all of these quangos with their cronies suggests that they see themselves going out and they’re really just trying to maintain as much power as possible, that’s arrogant, that’s nothing to do with coalition building, and in fact the Labour Party has yet to come out clearly and say these are the sorts of things we’d like to do with the Maori Party.

Harawira is of course right with his analysis.

GUYON What about National then are you comfortable, could you actually work with National?

HONE Another difficult one there, but no more difficult than working with Labour as far as we’re concerned. People have this big fear of National and Maori in terms of oh they’d get rid of the Maori seats wouldn’t they, but my response constantly is always the greatest land theft of my generation has actually been the Foreshore and Seabed and that wasn’t stolen by National that was stolen by Labour, would you expect us to jump into bed with them happily.

That is a very different tune to a few years ago.

But some idea of the challenges ahead:

GUYON Let’s talk about a couple of the things that you said you want to do if you have influence over a government, you wrote recently in the Northland Age that you want to remove GST from food and abolish tax for people earning $25,000 and under, how much would that cost?

HONE Actually Guyon I couldn’t care less how much that costs, what I do know is this.

Guyon says Treasury worked the cost out for them:

GUYON Well we did something that you should have done, we asked Treasury how much this would cost, they said it would cost two billion to remove GST from food and three billion more to cut taxes for those earning less than $25,000. You want free health care for kaumatua and kuia too, where is the money coming from?

I have a figure of $2.4 billion for removing GST from food. The no tax on those earning less than $25,000 could be even more than $3 billion. That is the cost of zero tax for everyone who earns $25K or less. But if you read it as being zero tax on the first $25,000 of income (which you would need to do otherwise someone at $25k pays $0 and someone on $26K pays pays says $5k) then the fiscal cost is arouynd $11.4 billion (according to NZIER calculator).

HONE Well let’s say the tax off cigarettes for the last we’ll say five years, that’s five billion dollars. This isn’t very hard eh, this isn’t rocket science, the government is taking a billion dollars a year off tobacco tax, they could certainly spend it in this area.

Hone is correct that tobacco excise tax is around $1 billion a year. But that tax is already budgeted for.

Even if Hone was suggesting we double the excise tax on tobacco, that would bring in an additional billion a year at most. Probably quite a bit less as the amount of tobacco purchased would decline. But even if it was $1 billion that is not even close to the $5 billion to $13 billion cost of what he wants to do.