Amongst the masses of information Labour did make available on their website, there was one document they did not put up. It was in the media pack, but not on their website. It was the table showing what impact on the deficit (and hence debt) Labour's tax package would have each year. According to their own numbers (which are debatable), the impact on Government finances in their first term of office would be:
* 2012/13 - $122m extra revenue
* 2013/14 - $384m less revenue
* 2014/15 - $648m less revenue
* 1st term - $910 less revenue
Now does it get better if Labour won a second term?
* 2015/16 - $466m less revenue
* 2016/17 - $283m less revenue
* 2017/18 - $127m less revenue
* 2nd term - $876 less revenue
So even under Labour's forecasting, Labour would run bigger deficits and debts for their first two terms of office (if elected).
That's right Dear Readers. Labour's own figures forecast a deficit in revenue of $1.86 billion in the first SIX YEARS of a future Labour Government.that's a long way away from the $4.5 billion per annum cash cow that Labour boldly leaked to the media ten days ago!
But wait; there's more - the Emperor Penguin of the Blogosphere (another term of endearment Robert) continues (with our emphasis added):
The numbers are even worse than that though. Labour have just invented numbers for how much extra tax they will get with anti-avoidance measures. This is not based on any actual policy or costing. Considering Labour is proposing to have a massive 11 cent difference between the top personal tax rate and the company tax rate, I believe the far more likely scenario is greater tax avoidance, not less.
If you remove the made up number for reducing tax avoidance, then that adds an $1.22 billion to the deficit over the first two terms. So the total revenue difference could be as much as $3 billion.
So at a time when New Zealand has the highest deficit in its history, and Governments overseas are defaulting on their debt, it is a strange time to announce a policy of borrowing for tax cuts.
Oh dear; we have a new mantra. Labour is borrowing for tax cuts! Isn't irony a wonderful thing? Little wonder that Labour doesn't trust us with the detail. And al the while, the Labour spin machine is in overdrive. But that's another story for another post...