# What the Treasury wealth tax paper really says, according to the man who co-wrote it **By:** Thomas Coughlan **Published:** 2026-07-28T05:52:32.437Z **Source:** [The New Zealand Herald](https://www.nzherald.co.nz/nz/politics/election-2026-what-the-treasury-wealth-tax-paper-really-says-according-to-the-man-who-co-wrote-it/premium/XYDPBAIXINELVLTX76YLFT7JUE) --- Green Party co-leaders Chlöe Swarbrick (left) and Marama Davidson. Photo / Sylvie Whinray The Greens’ “super-rich tax” would trigger a behavioural response of about 38%, according to the one of the three lead authors of a 2023 Treasury paper that the Greens used to inform the design of their central tax policy. Former Inland Revenue chief economist Phil Whittington was one of the three lead authors on that paper, which was written for Labour’s abandoned 2023 wealth tax. He said while he did not want to pick a fight with a political party about what it got right or wrong, his analysis of the 2023 paper would suggest the Green’s “super-rich tax” would have a behavioural response of about 38% – higher than the 28.% modelled by the Greens. He said he did not know of any country that had sustained such a broad wealth tax at such a high effective rate. A behavioural response measures the amount of tax revenue lost as people seek to avoid paying the tax by shifting revenue offshore or hiding it by other means. Whittington, who has since left the public service, supplied the calculations in a personal capacity. He also defended Treasury against the Greens’ allegation of becoming politicised for answering the Herald‘s questions about the organisation’s old policy papers. Make a beeline for the Beehive Get weekly politics headlines with commentary from our political experts straight to your inbox.By signing up for this newsletter, you agree to NZME’s Terms of Use and Privacy Policy. “As long as it is done consistently, I don’t see a problem with an agency clarifying misunderstandings if its work is being cited in support or opposition to a particular policy,” Whittington said. The Greens’ own figures suggested a far lower behavioural response, meaning the party thinks there will be less avoidance. The Herald l ast week published experts from the Treasury paper that informed the Greens’ modelling, noting a conventional reading of the paper would suggest a behavioural response of about 43.75%. Treasury did not model a wealth tax as high as what the Greens were proposing, but said the Herald’s reading of its methodology was “broadly correct”. Whittington said both the 28.5% and the 43.75% figures were “plausible”, however, he urged caution. “To be clear, that is not support for the Green Party proposal. I am not aware of any country that has ever sustained a broad wealth tax at an effective rate of 2.5%. “Spain’s headline top band reaches 3.5%, but Spain caps combined income and wealth tax at 60% of taxable income, so almost nobody pays the headline rate and there seems to be plenty of relocation and avoidance in Spain,” Whittington said. “I think it’s a very risky policy and I would expect that if it became more likely to happen, the very wealthiest would start getting their affairs in order to be ready to move,” he said. Green co-leader Chlöe Swarbrick explained how her party had come up with the tax: “The Parliamentary Library informed their modelling on what Treasury had made publicly available for the past three years in its 2023 paper. “We reviewed that against international and domestic research and experience, tested our conclusions with a number of economists and then had all of the figures independently audited by Infometrics. “Our modelling was informed by Treasury’s 2023 paper, new insights on which have only become available in an ad hoc way in response to Herald questions these last few days. We’ve always been upfront about that input, but it never stood alone as the sole input,” she said. Phil Whittington. The 2023 paper Whittington was working at Inland Revenue when the organisation partnered with Treasury to do the policy design on Labour’s abandoned 2023 wealth tax. He is listed as one of the three lead authors on a key Treasury paper that was used by the Greens to inform the design of their “super-rich tax” of 2.5% on fortunes of over $10 million, their centrepiece tax policy for this election. The Greens’ policy said the tax would have a behavioural response of 28.5%, which is the amount of tax that would be lost due to people shifting wealth offshore or using other tactics to avoid paying the tax. The Greens said this figure was “informed by Treasury advice”. The Herald last week revealed the Treasury paper that sits at the heart of that advice actually foresaw a far greater behavioural response – Treasury calculated this at roughly 35% on a tax of 2%, which could mean a response of 43.75% for a wealth tax rate of 2.5%. Former Finance Minister Grant Robertson wanted to include a wealth tax in the 2023 Budget. Photo / Mark Mitchell The Greens initially said the Herald and Treasury itself had misunderstood the 2023 paper and requested to have the Herald story retracted. After being presented with further evidence from Treasury that the Herald’s reading of its modelling was correct, the Greens accused Treasury of being “out of step” with international modelling on wealth taxes. The misreading of the Treasury paper appeared to have arisen from the fact the Greens had not considered that the Treasury figures they had used to calculate the behavioural response only took in one year of a wealth tax, while Treasury believed it would take three years for people to fully adjust their affairs. Getting to 38% Whittington set up his own consulting firm, Heuser-Whittington, and is therefore in the position to speak more freely about the 2023 paper he co-authored with two other Treasury analysts. He stressed his remarks to the Herald were made in a personal capacity. He told the Herald that Treasury and Inland Revenue’s modelling on behavioural responses drew heavily on the work of the UK’s Wealth Tax Commission’s 2020. Whittington said that report concluded that a “well-designed wealth tax would reduce the tax base by 7-17% if levied at a tax rate of 1%“. Whittington said that the New Zealand analysts ultimately decided on a higher behavioural response because of unique features of the New Zealand economy. “Migration to Australia is the most obvious one,” he said. On the Greens’ wealth tax, he said a very wealthy couple with $200m of wealth would be paying wealth tax of $4.5m a year, on top of income tax already being paid. That was $87,000 a week in wealth tax. “Plenty of people move to Australia for less,” Whittington said. “It seems very likely Australia would welcome anyone subject to the wealth tax. They would not even need to become Australian citizens. New Zealanders can live and work in Australia indefinitely and can always travel back to visit the grandkids. What matters for the wealth tax is simply ceasing to be a New Zealand tax resident. “That dynamic would exist in the UK too (and so is factored into the 7-17% figure from the wealth tax commission), but New Zealanders are already far more mobile than people in the UK, which perhaps suggests a larger migration response here than in the UK studies,” he said. Whittington said there was not a strictly linear relationship between the rate of wealth tax and the behavioural response it would generate. “The first percentage point reduces it by 17.5%, and then the next percentage point reduces what’s left (82.5% of starting wealth) by 17.5%, which means the total reduction is 32% rather than 35%,” he said. He said that applying this interpretation to the Greens’ tax would give you an avoidance rate of 38%, 9.5 points higher than what the Green Party had assumed in their policy document. However, Whittington said that both the Greens’ low 28.5% and the 43.75% figure, derived from a linear interpretation of Treasury’s behavioural analysis were both “plausible estimates”, given wealth taxes are highly uncertain. Could you ever get to 100% avoidance Whittington looked at whether a tax rate could ever be so high that you would get a 100% behavioural response – which would result from people moving or hiding all their wealth. He said this was “unlikely”. “If the wealth tax got very high, it might shrink taxable wealth by very large amounts, but there will always be people who cannot or will not move, or who decide to wait it out because they expect that a tax at that level would eventually be reduced to something less punitive or repealed by a future government,” he said. Laffer curve. Graph / Heuser-Whittington Whittington built a model that looked at what the “Laffer curve” might be for wealth taxes. The Laffer curve is a concept that tries to estimate at what point taxes get so high that the government would actually collect more money by cutting taxes and allowing the economy to grow more. “Counting only wealth tax revenue, the central estimates for the revenue-maximising rate sit somewhere around 3–4%," Whittington said. “What is most interesting from the simulations is the shape of the curve: it is nearly flat above about 2%. “At a 2.5% rate the tax is already collecting roughly 85-90% of the most it could ever collect at any rate, so raising the rate further buys very little extra revenue for a great deal more economic damage,” he said. Whittington added that when thinking about the wider tax system, the true peak of the curve would be even lower “because we would also lose the income tax and GST currently paid by the very wealthy people who would leave before that point”. Finance Minister Nicola Willis said the Greens' remarks about Treasury were "disgraceful". Photo / Mark Mitchell Attack on Treasury ‘disgraceful’ - Willis Over the weekend, the Greens accused Treasury of becoming politicised for the way it responded to the Herald’s media queries about the 2023 paper. Swarbrick said the Green Party was “incredibly concerned that Treasury is currently allowing itself to be politicised withad hoc incursions into one part of one political party’s policy". On Tuesday morning, Finance Minister Nicola Willis said those remarks were “disgraceful”. “The Greens can’t have it both ways, they can’t want evidence-based policy and then reject any evidence that doesn’t align with their world view,” she said. “When they talk about wanting independent fiscal institutions, well that’s actually what we have in the New Zealand Treasury. “For Chlöe Swarbrick to demean the Treasury by claiming that there is anything political about their objective analysis is really beneath her and I’m really disappointed by her comments.” Swarbrick hit back, describing Willis’ concern as “crocodile tears”. She urged Willis to “implement the independent, expert Parliamentary Budget Office she promised and the Greens have been offering her the deciding votes to establish”. “That’s the only parliamentary institution that, at arm’s length, could be charged with resolving allegations, let alone shedding light on the billions Nicola Willis has failed to budget for to meet the Paris Agreement by virtue of the Government shredding local climate action, or their Kiwisaver hole,” Swarbrick said. Willis had tried to establish a version of this policy earlier in the term, but was blocked by Act and New Zealand First. 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