Past event: Public Finance Debates 2013

A series of three debates on the theme "It's time..."

Organised by the Chair in Public Finance (Victoria University of Wellington) & the Government Economics Network (GEN)

"It's tax the internet"

"It's time...New Zealand extended charging for public infrastructure"

"It's time...New Zealand adopted a social insurance approach to welfare"

  • each debate was set for 1.5 hours: Two individuals each presented for 20 minutes; then ‘Commentator’ for 10 mins
  • one individual was the ‘proponent’ and made the case for, while the other individual was the ‘opponent’ and made the case against
  • the 'commentator', provided some 'middle ground' comments and some stimulus for discussion and Q&A with the audience
  • a straw poll show-of-hands was taken at the end of the debate to determine the ‘winner’
  • light refreshments will be provided after the debate to facilitate further informal discussions.

All speakers were asked to make the case strongly either for or against each of the above propositions - to inform, identify the strengths of the arguments/evidence used to support particular views and to enhance the debate ‘atmosphere’. Similar to past debates, it was made clear at the outset that the views and arguments expressed by all the speakers do not necessarily reflect either their own personal views nor the official policy or position of their employers.

Debate 1: "It’s time … to tax the internet"

Toby Daglish, Grant Scobie, Lisa Marriott

GST, as part of a broad-based low-rate system with few exemptions, should avoid the distortion of taxing some suppliers (domestic) and not others (overseas retailers). Increasing internet use will deepen and widen this distortion. On the other hand, NZ’s natural trade impediment of ‘distance from markets’ raises consumer prices and can generate location specific rent for domestic producers of NZ consumer goods versus foreign suppliers. The GST exemption for foreign internet retailers therefore merely counteracts this effective subsidy to domestic producers and lowers prices for NZ consumers. So, who is right?

Date: October 23, Wednesday, 3.00-4.30pm (followed by light refreshments)

Location: Victoria University, Old Government Buildings, Lecture Theatre 2, 15 Lambton Quay

Debate 2: "It’s time … New Zealand extended charging for public infrastructure"

Geoff Cooper, Peter Conway, Chris Money

Various ‘big public infrastructure’ projects in New Zealand (e.g. Auckland rapid transit, new harbour crossing, Transmission Gully) are likely to require substantial funding in the near future if they go ahead. Also, Auckland (and to some extent, Wellington) suffer considerable road congestion presently. Is it time to start road congestion charging and/or other types of infrastructure user charge to fund these investments and to enable greater infrastructure investment than a tax/debt constrained government could otherwise afford? What are the pros and cons?

Date: November 12, Tuesday, 3.00-4.30pm (followed by light refreshments)

Location: PricewaterhouseCoopers, Level 16, 113-119 The Terrace, Wellington

Debate 3: "It’s time … New Zealand adopted a social insurance approach to welfare"

Rhema Vaithianathan, John Gibson, Alison O'Connell

Several countries provide working-age welfare and retirement income funded from specific earnings-related ‘contributions’ (taxes) rather than funded out of general tax revenues as in New Zealand. These contributions are also sometimes related to the individual welfare payments received by beneficiaries, though this link can be ‘loose’ (as in the UK) or stronger (as in the Netherlands). What are the merits of each and should NZ continue to avoid social security taxes on labour? Or should NZ copy the ‘Kiwisaver approach’ applied to retirement income, and apply it also to working-age welfare where some benefits are directly tied to individual’s ‘welfare accounts’?

Date: December 2, Monday, 4.00 - 5.30pm (followed by light refreshments)

Location: Victoria University, Old Government Buildings, Lecture Theatre 1, 15 Lambton Quay