No tax cuts announced, no surprise there. No tax cuts flagged for the future, very disappointing. No roll back of fiscal drag, or bracket creep, for people paying more tax simply because their pay has increased with inflation — unfair and deserving more attention than the brush off the Minister of Finance gave it despite the expected surpluses forecast in a few years time.
$761 million for science and innovation, regional development and tertiary education.
$2.1 billion on public infrastructure (including such major projects as developing the harbour in Opotiki and reconstructing Waitangi wharf - $11.5 million in total).
$651 more for social investment (over four years) - the new public sector buzz word and including $168 million for a new model for at risk and vulnerable children.
$2.2 billion for health of which $1.6 billion is for DHBs many of whom can't cope within existing budgets.
But smokers get stung again with a further 10% increase in tax each year for from 2017 to 2020. In January the Taxpayers' Union made public the Treasury's advice that smokersalready pay more than three times the health costs of their habit.
Penalising people for voluntarily choosing a damaging habit is morally questionable when the very people who pay are those who can least afford it. But governments always 'need' more money. The Budget forecasts the tax hike to take in an extra $280 million per year by 2021. The aim is to reduce the prevalence of smoking and one might ask if this extra tax is effective in achieving that, will it raise all the extra cash estimated ($425 million over four years). It may be possible to reduce smoking rates and raise a lot of extra money at the same time.
As we've pointed out numerous times, if the Government was genuine about reducing smoking rates (and it not also being influenced by the extra tax dollars) why hasn't it legalised e-cigarettes, which are estimated by Public Health England to be at least 90% less harmful and are Britain's number one smoking cessation tool?
The strategy to get back into surplus is applauded: balanced budgets are simply a basic requirement of sound government.
Budget 2016 scratches lots of proverbial itches: homelessness, vulnerable children, home insulation, social housing, cleaning up rivers, more medicines, bowel screening, special needs children, and a raft of others.
But for ordinary people without any special needs, there's not much, unless you count a well managed, low inflation economy, currently growing more than most comparable countries.
Answering questions in the Budget lockup Bill English was asked about whether there was room to accommodate the Prime Minister's suggestion of a $3 Billion tax cut package. Initially Mr English replied that this was a matter for future choices and reeled off a list of competing priorities: debt reduction, other spending pressures, investment opportunities, saving for the future (contributions to the Cullen Fund are to resume in 2020).
But later he added another claimant on the emerging surpluses and I quote "ensuring middle income earners don't find themselves on the top tax rate". This cuts in at $70 000, and as the average wage is forecast to rise to $63,000 by 2020, bracket creep will be a reality for many.
Which might just (on an optimistic construction) mean that the door is still open for compensation for fiscal drag. As it should be. The Parliamentary Library calculated for David Seymour MP that the lack of changes to compensate for inflation since 2010 means the government had collected $2.1 billion more in taxes.
The Taxpayers' Union believes that all of this should be returned to taxpayers and that indexation of tax brackets should be introduced to prevent taxpayers being dependent on the political generosity of governments.
Click "read more" for our initial comments to media are listed below.
The Taxpayers' Union is slamming the Government's "Innovate New Zealand" initiative, as announced in Budget 2016, as growing the Government's regime of corporate welfare.
It is also raising concerns with a new focus on small business and regional economic corporate welfare, "Taxpayers will be alarmed that National are now expanding corporate welfare from big business into the small businesses backbone of the economy."
"Another Budget another huge cheque from the taxpayer for KiwiRail", saysTaxpayers' Union Executive Director Jordan Williams reacting to today's $190.2 million capital injection into KiwiRail announced in Budget 2016.