When is a $50 tax cut not a $50 tax cut?

Voter expectations could be higher than National realise, and higher than they can afford

Reading the papers this morning, there are hints that National’s $50 tax cuts plans might not have the punch the Opposition would hope.

Reality is never as good as hope, and National may suffer for it when they finally, finally announce their tax plans next Wednesday. One line from a Paula Oliver/Paddy Gower piece in the Herald today leapt out at me.

Prime Minister Helen Clark yesterday tried to increase the pressure on National by suggesting the cuts would be worth only about $18 a week more than Labour's package—far from the $50-a-week figure that has been touted.

To be fair, National has never said there cuts would be $50 more than Labour's. Bill English has repeatedly said that his tax cuts would "build" on Labour's cuts. If Labour's are worth roughly $25 a week, National's were always meant to be about double that. But is that what voters have heard?

Clark seems to think that $50 number has stuck so strongly in voters' minds that their expectations are higher than National ever intended to deliver. I know I've had conversations with people who seemed to think National is planning to offer Labour's cuts plus $50.

So now Clark's saying an $18 difference (which you get if you work on a $32 average cut to workers once the government's plans are fully implemented), is nothing to bother changing a government for. Interesting tactic, given how Labour has been punished for under-estimating public expectations in the past.

Colin Espiner wrote in The Press this morning, "there are questions around how quickly this could be phased in". Now that's interesting, because this year National has been purposefully vague when talking about the timing of their cuts. Speeches and press releases have been littered with phrases such as "step-by-step" and "ongoing".

When National was trying to pound Labour on tax back at budget time in May, John Key indicated the tax cuts would be “north of $50”, while Bill English, perhaps more sensibly, simply said they would be “meaningful”, which is of course a meaningless word. English has obviously settled on what he thinks the country can afford in recent weeks, confirming that National’s cuts will be “around those expectations”.

The question is, just what are voters expecting from National?