Tax offer ‘simplistic’

Press, 5 August 1981, Page 2

Tax offer ‘simplistic’

PA Wellington Labour's Shadow Minister of Labour, Mr E. E. Isbey, was yesterday critical of the Government’s proposals on youth wage rates and a wage-tax trade-off. He termed the trade-off simplistic and said there was little point in suggesting schemes such as youth rates until there was confidence in the economy to confidently provide employment. Mr Isbey said that by threatening to enforce the principle of a wage-tax trade-off by legislation the Government was attempting

a "massive" confidence trick on working people. Until- the Prime Minister (Mr Muldoon) was specific about the terms of a tradeoff, the Unions could not be expected to sign a blank cheque on the matter, he said. “Fundamental points such as this are vital to the w-hole concept of a trade-off. Without a detailed proposal from the Government, threats of enforced legislation should be seen as diversions from the real and urgent need for comprehensive tax reform,” Mr Isbey said. How the tax “cut” was

financed would influence the effebts of a wage tax tradeoff, he said. If it came from real reductions in Government expenditure, it could hurt workers and families more than it would help them. “Taxation is a Government responsibility. Failure to formulate a workable fiscal policy cannot be laid at the door of the unions. "But in any wage-tax trade-off, there must be full consultation, and that includes the two thirds of the workforce who do not belong to the Federation of Labour