Saturday, October 10, 2009

ZenTiger Greens Buy Back Integrity

The Green MPs’ superannuation fund will sell its two properties to give the public maximum clarity about the use of Parliamentary housing allowances, Green Party Co-Leader Metiria Turei announced today.

What an over-reaction! Selling the homes is apparently to achieve transparency, and reclaim their integrity, even though they are "doing nothing wrong".

Selling their property does not reclaim integrity.

This practice of purchasing property and renting to themselves using tax payer money to pay the rent is something all the MP’s are doing, and I include their offices in this. Labour has a 20 million dollar property portfolio for goodness sake (and cried poor when paying back their election over-spending)

Not that any of that is likely to be illegal (except the bit where the Greens claimed twice on the same place. Not a mistake any other normal people renting a property together would be likely to make). In this regard, you don't just pay back money, you have to pay penalties on use of money and interest. That's the laws they have made that apply to tax payers and businesses. Why are they exempt?

Anyway, the issue of renting properties comes down to the degree of personal gain from a salary arrangement, and applies to all MPs. That is the issue to fix, and the Greens selling their property will not fix it.

In general terms, I don’t see anything wrong with what the Greens and all MP’s are doing other than this element of unfair personal gain, compared to how other employees are typically treated. If that was costed into the equation, via a small tax component on that gain, it would be balanced out to be just as unfair as the tax system politicians have designed for all of us.

The Greens have called for a review, and I support them in that. The review needs to be wide ranging and the issue under review is actually quite straight forward - a look at all the examples of where personal gain is made from salary and reimbursements over and above what a normal citizen would get. MP's have structured their finances to maximize their long term dividends without being taxed at the source or this gain being treated as taxable income. The banks tried that and were found to be arranging their affairs largely for the reason to avoid tax. They will have to collectively pay back billions.

How much do our MP's owe?

And will the result simply wake them up to how overly complex and unfair our tax system is when it actually applies to them? That might actually be the best outcome. Because if the only outcome is for them to pay a bit more tax, their salaries will simply be raised to compensate. They can do things like that, and continually prove it.

Related Link: My Friday Night Free For All rant

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