Monday, April 28, 2008

Lucia Income Splitting and Societal Effects

I'm all for income splitting - the idea that a couple ought to be taxed as a joint entity rather than individuals. In a society where tax is used as some sort of social equaliser as it is in NZ, it doesn't make sense that a working couple with the same income as a single earner couple get taxed different amounts. You'd almost think that the government wants to penalise couples who have one partner (typically the wife) stay at home to look after the children while the other goes out to work.

I know there are many arguments against income splitting, such as what about single parents and it's not fair on those couples with children. In an ideal world, I personally think that income tax ought to be abolished completely and replaced with GST on everything. The privacy aspect alone of income tax allowing the government to know far more about us than they should is enough of a reason to abolish it completely.

However, these things take time and in a country where it is evident that it would be incredibly beneficial to encourage the mother to stay home and look after those children while her husband goes out to work - then why not?

Or do we want every parent working and their children looked after by the state or carers that are not their parents? Because except for a few that have to really stretch to make it work, that is what is happening right now. And what are the results?

In fact, this income splitting scheme ought to be extended to all married couples, whether they have children or not. Other than that, I think Dunne's idea is a good one.


Related Link: Debate on letting parents split income for tax gain

Older related posts at SirHumphreys: The Best Slaves
How to create Socialist Man

27 comment(s):

Danyl said...

How would you stop every unmarried taxpayer in the country from entering into a marriage of convenience and halving their income tax overnight?

Lucyna Maria said...

Easy. If it were me, I'd make divorce far more difficult.

Danyl said...

So your policies would make it financially advantageous to enter a marriage of convenience and then very difficult to leave it if, say, you wanted to marry someone you were genuinely in love with.

Aren't you a little concerned that this would make the institution of marriage a totally meaningless joke?

Lucyna Maria said...

Danyl, the institution of marriage is pretty close to being a totally meaningless joke now.

Especially as those who are married, with children, with only the father working on a relatively reasonable salary are penalised far and beyond just about every other segment of society.

So, in answer to your question, no, I'm not worried at all.

Andy Moore said...

Hmmmm, as far as I know, it is the Kiwi Party who has underlined income splitting as one of their key policies. Looks to me like Dunne's just ripping them off.

Far better though, would be to introduce a flat tax rate (realistically for now) of about 20%.

And probably bang GST up a bit more. But yes, as some of the commenters have said, income splitting could be abused.

Oh, and as for the Government essentially encouraging/forcing both parents to be out at work, necessitating child care for young children, it's clear this is their agenda.

...As we have been taught, most recently with the passing of the Anti-Smacking law, and now with the Public Health bill on the way in, Nanny State knows best!

Sus said...

"Far better though, would be to introduce a flat tax rate (realistically for now) of about 20%".

Correct.

"And probably bang GST up a bit more ...".

Incorrect. What the hell would you do that for? GST in itself is inflationary, artificially raising the price of everything by X%. It hits low-earners hardest. It creates a slave of every business-owner.

Far better to pare down Nanny State instead, don't you think? The fewer bastards, the better.

Sus said...

" .. institution of marriage is pretty close to being a meaningless joke .. "

Lucyna, in line with my philosophy (!), I would remove the state from marriage forthwith.

Just think about it. Marriage is a contract between adults. As such, there is no necessity for the state to involve itself. It does, of course, hence marriage is politicised; Margaret Wilson's disgusting Matrimonial Properties Act being a prime example of state interference.

Contract law would suffice beautifully. Any violation thereof would be a legal matter.

Danyl said...

I would remove the state from marriage forthwith.

That wouldn't really work for Lucyna - she'd very much like the state to have extensive control over people's power to marry and divorce.

Lucyna Maria said...

Danyl, you have a very warped understanding of my thinking on marriage and divorce.

"[C]ontrol over people's power to marry and divorce" - I'm not sure what that actually means.

In some sense, Sus is correct. Marriage is at it's simplest level a contract. The state partially exists to uphold contracts and therefore removing marriage from the "power" of the state without removing the enforcement of other contracts in the same way is to be inconsistent. And misogynist as women and their children tend to be far more adversely affected in a marriage breakup than men. This is probably why there was such a huge uptake of Christianity in women in the early days - Christian marriage protected them in a way that Roman marriage didn't.

Scribe said...

Andy,

Hmmmm, as far as I know, it is the Kiwi Party who has underlined income splitting as one of their key policies. Looks to me like Dunne's just ripping them off.

Peter Dunne claimed in a Christian publication that his party was pushing for income splitting many years ago (which is true). He and Gordon Copeland (of the Kiwi Party) will probably argue whose idea it was in the first place, but Peter says he was pushing that barrow before he even met Gordon.

He may be hoping no one will check the veracity of that; or he may be telling the truth.

ZenTiger said...

so your policies would make it financially advantageous to enter a marriage of convenience and then very difficult to leave it if, say, you wanted to marry someone you were genuinely in love with.

Danyl, so are you saying that you expect people to create a fraudulent relationship based on lies, knowing that it would be hard to undo the lie should they sudddenly want to then create a genuine relationship. They would be stuck because of the initial lie, and would then cry "poor me".

This to me seems to be consequences matching actions. That would be shocking, and the last thing liberals actually expect.

danyl said...


Danyl, so are you saying that you expect people to create a fraudulent relationship based on lies, knowing that it would be hard to undo the lie should they sudddenly want to then create a genuine relationship. They would be stuck because of the initial lie, and would then cry "poor me".


Maybe this would happen to some people - I think that most of the population would simply enter into a marriage of convenience as soon as they started paying tax and then forget about the institution for the rest of their lives.

control over people's power to marry and divorce" - I'm not sure what that actually means.

Let me put it like this - do you want to live in a country where men are legally entitled to marry other men? Or where people can have multiple spouses?

Sus said...

"do you want to live in a country where men are legally entitled to marry other men? Or where people can have multiple spouses?"

What's the problem, Danyl?

Just because another adult's choice of lifestyle is not to my liking or practice, why should it be disallowed?

Note that I use the words 'adult' and 'choice'. As long as there is no coercion involved, let adults mind their own business.

I cannot be free unless you are and vice versa. I might find the concept of multiple spouses a la Mormonism/Islam weird & certainly not my cup of tea, but provided no adult is *forced* into any arrangement, whose business is it? Not mine. Not yours. And certainly not the state's, hence my initial post re marriage being a contract.

The state is there to uphold contract law. That should be the extent of its involvement.

Gee, people. This is an example of why I left the right years ago. I was never comfortable with its preoccupation in minding other adults' personal business. "I don't like that, so we'll ban it!" Sounds exactly like the odious Sue Bradford, eh, which is nothing to be proud of!

Just as the left is obsessed with interfering economically.

Left/Right - it's still the damn state. The smaller, the better, thanks.

Anonymous said...

"I cannot be free unless you are and vice versa. I might find the concept of multiple spouses a la Mormonism/Islam weird & certainly not my cup of tea, but provided no adult is *forced* into any arrangement, whose business is it? Not mine. Not yours. And certainly not the state's, hence my initial post re marriage being a contract."

I can see it now.

NZ secular society. Will this include wives with multiple husbands or husbands with multiple wives as per Mormonism/Islam?

dad4justice said...

Danyl;what does the NZ secular state do about the huge increase in the breakdown of family, child abuse and all the problems associated through fatherlessness?

danyl said...

NZ secular society. Will this include wives with multiple husbands or husbands with multiple wives as per Mormonism/Islam?

Polygamy tends to surface in ultra male-dominated societies like, well, Mormonism and Islam in which the women are treated as chattel, not people. I doubt it would be a very big part of daily life if it were legal in New Zealand. In relationships between equals threesomes (and so on) simply don't seem to be very stable.

Hell, even Osama bin Laden couldn't make it work.

But if some people can find happiness in a group marriage - and those people are out there - then why should the state have the power to stop them?

Sus said...

Spot on, Danyl. My thoughts, exactly.

It goes without saying that all concerned forgo any reliance upon the state, of course.

Unlike the absurd recent situation in the UK, whereby a Moslem man will reportedly receive multiple benefits to accommodate all his wives.

Madness, not to mention immoral.

Anonymous: In a libertarian world, a "secular" society would never prohibit you from having a religious home, should that be your preference. You are free to choose accordingly.

That is precisely why the rights of the individual should be paramount ... to ensure that you should never be forced to succumb to another's will and vice versa.

Sus said...

Dad4justice:

I would put it to you that the horror stories concerning child abuse and fatherlessness in NZ have much more to do with the abject failure of the "welfare" state, than any 'secular' state.

Yes?

dad4justice said...

Your opinion sus, as the government clearly don't want to address the child abuse issue !

greg said...

This thread strikes me as "divide and conquer".

Split or no split we still pay too much tax and what hugge sums we are paying is being squandered.

Anonymous said...

Danyl
the old straw man about people marrying for convenience was pulled out when student loans were first being sorted out. Most students didn't enter into marriages of convenience to get the full allowance.

There is no evidence that they would do the same for income tax splitting.

Polygamy also appeared in Roman society which according to you on other threads also had female and homosexual dominated arenas. So which is it?

Dave said...

This policy is a United Future Policy from way back. The Kiwi Party just happen to agree with it. The policy clearly favours high income families and it would be a good policy if it was fair - ie didnt favour rich families.

A household with a single earner on $60,000 can save $3,217 per year from income splitting. However, a household on $36,000 stands to gain only $570 per year. That is, a family on just over half the income gets less than one fifth as much tax relief.

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Lucyna Maria said...

Anonymous,

Your question was completely off topic. If there is something in the news that is of particular interest to you, feel free to create your own blog and write a post on that topic.

If you continue to ask why it is that we do not comment on one of the thousands of daily news stories available online, I will continue to delete your comments.

We do not exist to serve your insatiable curiosity as to what we might think about anything.

If you really feel a particular news item is of interest to us, feel free to email one of us with a link to that story. However, don't be surprised if we choose not to comment on that story.

And if you don't like that, tough. Go spend the time writing on your own blog rather than spamming ours.

Sus said...

D4J: It is indeed my opinion that Bradford's A-S bill was *never* introduced to combat child abuse. That was a most convenient red herring. It was introduced solely to further impose state control, as befitting a marxist like Sue Bradford.

And as for the govt not combatting child abuse, it is also my belief that this govt's state welfare policies just continue to contribute to the ongoing travesty.

I have nothing but contempt for the bastards.

dad4justice said...

Well said sus.

Bradford and her social engineering sicko mates have established a modern day jihad against families and fathers. They crusade a nanny state mentality, as they fear family loyalties which are the hardest to control.

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