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It turns out that if you're rich and are identified as such in an online search, there may be higher chance you'll pay more taxes. This state of affairs has all but been confirmed by Revenue Minister David Parker. Yes, ACT leader David Seymour has been probing in Parliament why a group of wealthy Kiwis have been caught up in a "survey" by the Inland Revenue. When asked about who has been included in the survey, Parker acknowledged formation of the list included scanning public records, including the NBR List. So the IRD "methodology" is to go online, and do a bit of googling?

The NBR, which I write for, has no physical version of the paper - its an online publication - apparently since the distribution costs became too high. So Parker appears to be confirming that the IRD are doing online searches to see whose name pops up on that kind of outlet. So it's obviously best to stay out of the news if you're "wealthy" and tell everyone you're poor. But we already knew as much.

What's the background to IRD's snooping? Parker's long been fascinated with the "top 1%", or "top 0.1%", stemming from his interest in Thomas Piketty's book, called "Capital". For a while, he could barely stop talking about it back when I used to see a bit of him. It has had a somewhat unhealthy influence on Parker's philosophy - especially Piketty's obsession with measuring inequality and the assets of the top earners. What the book is weak on, and in turn it's a weakness of David, is how such measurements should influence tax policy.

That is, I concur with the writer of the best-selling economics textbook in the world, Greg Mankiw's, view of the Piketty book on this matter (see below):

"My own view - and I recognize that this is a statement of personal political philosophy more than economics - is that wealth inequality is not a problem in itself. I do not see anything objectionable if the economically successful use their good fortune to benefit their children rather than spending it on themselves. As a society, we should help those at the bottom of the economic ladder through such policies as a well-functioning educational system and a robust social safety net (funded with a progressive consumption tax). And we should help people overcome impediments to saving, thereby allowing more workers to become capitalists. But if closing the gap between rich and poor lowers everyone’s standard of living, as I believe Piketty’s global tax on capital would do, I see little appeal to the proposal.


Beware making public commentary on Covid, even if you're a medical expert, let alone if you're not. My rule is to stick to remarks about the economic implications of different virus policies, not the virus policies themselves, being totally unqualified to do so.

Here's why. Over the weekend, the Israeli Coronavirus Cabinet, for example, agreed new restrictions at a crisis meeting late on Saturday, which are subject to approval by the full Cabinet. In light of the just discovered Omicron variant, those Israeli nationals "coming from high-risk red countries will have to quarantine in designated state-run hotels until they receive a negative virus test result", reports the Times of Israel in an article headed, "Israel decides to bar tourists, reinstate quarantine rules to contain Omicron".

Yet just a few days ago on 21 November, National Party MP & possible leadership contender Chris Luxon labelled NZ's border rules for Kiwi nationals returning home, "ridiculous". In the video below he says putting them into government designated quarantine hotels is "outdated", "lose-lose", a "misery" and a "perversity". Luxon argues that Kiwis abroad should be able to return & "isolate at home like the people in our community today".

However, Luxon's logic is built on an assumption that our local & overseas strains of Covid are the same. In such a case, he's right: it's inconsistent to subject two groups of Kiwis, locals and overseas nationals, to different (home-isolation vs designated hotel quarantine) regimes.

But that inconsistency may no longer exist. Since should a Kiwi currently abroad have caught the new virus variant just before flying into NZ and then go into home-isolation upon arrival, there's a risk of them bringing the new strain into the community. At least, that's how Israel seems to be viewing things. Who would've thought a comment about the "perversity" of our "outdated" and"lose-lose" border controls could itself be outdated within days!? The virus takes no prisoners when it comes to opinions on best policy responses.

The policy issue Luxon may have been better to address is more to do with the limited government MIQ facilities. The lousy lottery booking system which has left thousands of Kiwi nationals stranded abroad was based on poor economic advice. Supply should have been expanded, paid for out of revenues from the likes of Google founder Larry Page, who had a high "willingness-to-pay" on the demand-side when he used the facilities on his visit to NZ.




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Robert MacCulloch