Originally Posted by
elZorro
Daytr, I did say that. It would be hard to know for sure without something like a Panama Papers leak or an admission from the Hagamans, but in the company shareholders of at least one Hagaman company is an entity called The Gibraltar Trust. Gibraltar is a well-known tax haven region. This pattern is not uncommon in NZ amongst the big movers and shakers, we just don't get to hear about it.
David Seymour was just on the telly saying that the National Govt should be looking to make tax cuts, and not to worry about paying off the new debt, because it's only reached 26% of GDP. In the same breath he said that many private people would have debts above that percentage of their household income. No-one commented on that quick justification.
Except the govt income is only about $65 to $70 billion from all sources each year, and I believe it is lower than it should be by far more than the often reported $1billion from tax haven leakage, tax avoidance, cashies, and house or property flipping that beats the system.
So David Seymour mixed up two different percentages. The NZ govt has borrowings that match or exceed its total income in any one year, and has to pay interest on that. They also have to rotate some of the shorter term borrowings, and replace them with new ones. They are still borrowing more against the public purse. It's eight years on, they haven't even been able to start showing a real budget surplus yet. Moving some costs forward into the next financial period to report a small surplus, is not making a surplus.
That's probably why they're now having to admit that they can't offer any tax cuts in the next budget. Because the govt income, such as it is, (by the time they look after all their mates who have showered them with "donations/unpaid taxes" to fight the next election) has already been allocated, plus more no doubt.