Posts Tagged ‘New Zealand’

The GST hike

The biggest reverse culture shock I'm experiencing (by reverse I mean NZ is obverse side of my little world) is that this country suddenly seems so hopeless. Everything in China, at least in big cities like Beijing and Shanghai is booming, building projects are happening in a lightning speed. China is also a world's second biggest, or biggest? market for luxury goods. My friends there are speeding their money like burning toilet paper, while I'm still counting every cent of my earnings.

Making my feeling worse is the price hike on almost everything. I only left the country for 3 month but everything seemed to have its price increased for several rounds, and I'm hearing the GST is also on the price hike list.

It's very difficult to avoid paying GST, it exists everywhere in people's daily economic life, making it one of the most effective revenue gathering machines for the government. There are many ways to avoid paying too much personal income tax, and tax on specific goods is more likely to decrease demand rather than increase the taxation revenue.

But of course this isn't all about revenue gathering. This is because Mr Key wants to give people tax cut, more specifically, the high income earners. In his speech made to parliament,  Key states that low income earners will be compensated through a upfront increase on benefits and working for families programme, but the trouble is, there's still very little details to see whether the compensation is enough to offset the GST increase.

Another feature of GST is that it treats every one equally, people all pay for the same rate. Statistics New Zealand says GST increase to 15% is likely to affect the CPI by a 2%+ one off increase, theoretically at least. What would really happen after the increase is still subject of a debate. Many New Zealand businesses advertise goods price ends with .99 just to make the price more appealing.  Many businesses will be facing a not so tough choice - whether to absorb the 2.5% increase themselves, or add it to the current price.

Well one of the phrses or excuses businesses just love to use is " we have to make profits".  So my guess is that the actual increase is likely to be more than 2%. Low margin and low price goods are more likely to get a $1.99 to $2.99 type of price hike as businesses are already sturggling making profit on those goods. Statistically, the overall increase would not be that huge, but the fact that troubles me is that low priced goods are more likely to be daily necessities.

I can't really quite understand the ideology behind this tax structuring apart from making high income earners happy. Yes this does give people more choice, as they got more money in hand - whether by more it means another 50cents or $50 in hand, is another problem. However, there are some choices people just don't have the choice, we all need food survive regardless whether you are high or low income earners.  The idea of removing GST on foods and petrol has been floating around for quite some time, but the government seems to have very little interest in it.

Capital gain tax is another thing government isn't very keen on. Speculating on real estate did make a lot of people rich, but that's at the expense of putting even more people at miseray. And most importantly, a healthy economy needs real economic activities,  new money has to be made - in the form of goods or services.  Prosperous property market sounds good, and looks good on GDP, but that's not real economy. It's unsustainable and who knows if he or she isn't the unlucky one or the greatest fool?

Government's very little action on these area does suggest me something they didn't tell. In his election promise John Key said he wants oversea kiwis back to their country and keep the young ones here. However, as a young adult myself,  the outlook of  me to stay in this country looks fainter every day, stuffs this government is doing, or not doing is making a graduate student  more difficult to make a decent living out of average wage.

New driving law

Just a reminder that starting from November, driving while using the cellphone by hand is not allowed anymore. That includes texting and talking on the phone.

Base my experience I support this measure. As a still relatively  inexperienced and cautious driver I have never attempted to do either. I don't know how others managed to do two things at the same time, but for me, using cellphone removes my eyes from the road, it's no different than driving blindly. No need to prove how dangerous that is.

However, cellphone really is just part of the problem.  People do and can be distracted by all sorts of things while driving. But most importantly, I usually find that it's where your mind is, rather than where your eyes are that makes the difference. I have found  little evidence shows that such law change can reduce the road toll, but plenty on how bad mood can influence driving performance. Talking over the cellphone, although using the hands-free set, can still take people's mind off the road.

The only solution  that can genuinely reduce the road toll is to ban cellphone use altogether, but no government at its right mind would adapt this measure as it would likely to be very unpopular among voters.

Rebiya in NZ

I went to Rebiya Kadeer's speech in Auckland.  Her visit was organised by the Green Party and Amnsty Internaional in NZ, two well-kown "anti-chinese" organisation among politically minded Chinese students here. However, I was there to hear another side of the story, not to protest, and I did gain some knowledge on her story and position on a range of issues.

But I was more interested in the role of Chinese government in regard to leaders like the Dalai Lama and Mrs Kadeer.  Kadeer was not a well-known figure before the unrest in Xinjiang in July this year, before that if you refer that name to a Chinese, he or she is more likely to have very little or no knowledge on who she is.

People sometimes joke that Chinese government regularly award two awards that are even more important than the Nobel, namely GFW's Web Choice award and Chinese Government Recommended Award - if you know a website is blocked by the Great Firewall of China, you know it's a website worth to visit. Similarily, if Chinese government blames someone, you know he or she is worth to listen to.

A state like China needs enemies - if you go back in history, at any point of time, Chinese government always propoganda at least one enemy of the state to its people - the Dalai Lama, oversea chinese democracy movement, "oversea anti-chinese forces" and so on.  This is a bit like Bush administration, it's the only way to divert people's attention.

However, for the speech itself, I was in fact quite disappointed. It was a good introduction for her positions on some issues, but nothing else was there but more of a blame game.  I still think that her popularity is largely due to the help for the communist government, in real life, she's no way near the Dalai Lama.

Key on Letterman

John Key did a top ten list on Letterman. It should be on Prime in few days, however, here 's the clip anyway.

And here's the list.

10 The Auckland Airport now has a cinnabon
9 We have the loosest slot machines in the Pacific Rim
8 Only a convenient 20-hour flight away
7 It’s like England without the attitude
6 Down there Leno’s on at 9 o’clock
5 Get the whanau together, stay in a bach, crack open the chilly bin and slap on your jandals
4 Visit in the next 30 days, I’ll pick you up at the Airport
3 70% of our energy is generated through renewable hydropower – look they don’t all have to be jokes
2 We drive on the left side of the road, like the British and Lindsay Lohan
1 Unlike most of the world, we still like Americans

Number one is clearly my favourite:)

Sue Bradford resigns

After 10 years of being a Green MP, Sue Bradford has announced her intention to retire at the end of october.

I have to say that Bradford has been a highly successful parliamentarian. During her service she has managed get three of her private member's bill passed, including raise youth minimum wage in line with adult wage and the highly controversial Anti-smacking bill.

She has been a champion of representing people who usually don't have their voice in the parliament - the young and the unemployed.

And no, I don't regard her as an "extremist" in anyway. She is just simply a woman who has the principle and the guts to stand firm of what she believes. However, her fate was sealed since the anti-smacking bill, only 7 MPs voted against the bill, however, when the tide is turned, it suddenly becomes "Sue's own idea".  In my opinion this is directly responsible for her failed bid of the party leadership - the society is turning right, and her very extreme left image would damage the Green Party.

Well, it's not their money they are spending

Kiwi Party leader Larry Baldock  didn't get his the way for the first referendum, so he decides to have another go - this time, it's on whether a referendum should be binding.

I actually agree with him this time. In a democracy people should be the utilmate ruler, and a binding referendum provides a check on politicans, preventing them from forgetting who voted them in the first place.

However, in order to make the referendum binding, there are some criteria the referendum you have to meet first - the most obvious one - people ought to at least know what it binds for. The last referendum question is by no contest, the worst example of this.

It was very clear from the start, Mr Baldock hijacked the smacking issue for his own political gains, and this time he didn't even bother to hide his intention - he wants the referendum to coincide with the next general election.