David Seymour: Government is misguided on capital gains tax, school reforms

Opinion 25/01/2019
David Seymour. Photo: Getty.

By David Seymour, ACT Party leader

OPINION: Should the Government take a third of your money through taxes? Control local schools from Wellington? Or should you and your community be able to create your own opportunities with less government interference?

These questions concern every New Zealander. Because, even if you aren’t interested in politics, politics is interested in you.

The Government is going to be taking a bigger interest this year in two key issues: school reforms and the proposal of a capital gains tax.

Consider tax. The Government takes 33 cents of every dollar earned in the economy through various taxes, levies and charges. Labour wants to take even more of your money, share it around, and make people more equal. That would be the goal of a capital gains tax Labour may propose this year. A capital gains tax is a tax on the sale of certain assets like small businesses and shares.

We don’t support a capital gains tax because, among other things, it represents ‘double taxation’. You would be taxed first on every dollar earned from the asset and then again on the sale of an asset you purchased with that income.

But, more fundamentally, ACT believes people should keep more of what they earn. Not only is that fair, but it also encourages people to do productive things – build exciting new businesses, for example – that higher taxes will crush.

What about education? We once led the world with community-governed schools where elected parents call the shots. Over the years, the Ministry of Education has tripled in size and communities have lost control.

The Government’s education reforms – changes to the ‘Tomorrow’s Schools’ model – will reduce parent power even further and put control over schools in the hands of distant government bureaucrats. New government-run ‘education hubs’ will control schools’ money, property, enrolments, zoning and even the appointment of principals. This is an attempt to make schools more equal, even if it makes good schools worse.

ACT believes these changes are misguided. We want parents to be free to shape the future of their local schools because engaged parents lead to better education outcomes, and opportunities, for children.

These are just two issues that will dominate the political year. Other issues will inevitably arise, pitting a government that believes it knows best against people who just want the freedom to create their own opportunities. ACT will be supporting them.

David Seymour is the leader of the ACT Party.