Roman Travers: New Zealand can't afford tax cuts

Early Edition on Newstalk ZB

With any promise there’s always an element of wiggle room, misinterpretation, or perhaps reversing out at high speed.

Although I have huge admiration for anyone who keeps their word and sticks to a promise verbatim, the coalition government’s promise of tax cuts isn’t a promise I’m happy for them to keep.

Anyone who only heard that promise in the runup to the election and based their voting decision upon that one fiscal soundbite possibly has a dubious voting history. But then again, it’s promises like that which ultimately attract the low hanging fruit pickers to any party.

Yesterday, we heard Prime Minister Christopher Luxon reiterate his governments promise of tax cuts, as we head closer to this month’s budget announcement.

He made the comments in a speech to the Auckland Business Chamber yesterday afternoon; and used the opportunity to bat away criticism of the coalition's promised tax cuts, saying "the squeezed middle" deserved support given the tough cost-of-living.

The ‘squeezed middle’ he refers to must now be equivalent to the area under a bell curve: To the extreme left and right of the squeezed middle must now surely be only poverty and extreme wealth.

It’s demonstrably obvious to anyone living in New Zealand that there are more and more of us tracking the finances daily, and really thinking hard about how on earth to further reduce the already relatively mediocre lives the ‘squeezed middle’ live.

Even those whose only focus at the voting booth was the promise of tax cuts can see that New Zealand cannot afford to receive them.

Of course, it’s admirable to see The Prime Minister reinforcing his fiscal promise and sticking to his word; but I don’t think there would be many of us who’d complain if he came out today and told us that —under the dire current economic climate, with so many things to fix— the promise of tax cuts is off the table for now.

Defer tax cuts. Use that whopping, dangling carrot at the next election.

No doubt it’ll still be appealing – and no doubt, a promise of tax relief will be even more welcome come the general election of 2026.

The truth isn’t always what we want to hear. Sometimes the pain of a promise broken isn’t as painful as one you’re determined to stick to.

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