“Today’s report released by OliverShaw shows exactly why there’s no place for tall poppy syndrome in the tax code,” says ACT Leader David Seymour.
“Revenue Minister David Parker has often repeated the fallacy that wealthy New Zealanders are undertaxed, in a speech last year he said “the effective marginal tax rate for middle income kiwis is generally higher than it is for their wealthier co-citizens. Indeed some of their wealthier Kiwi compatriots pay very low rates of tax on most of their income.”
“This report proves the Revenue Minister’s words are nothing but empty rhetoric fuelled by a deep desperation to take more from successful New Zealanders. It states that 21.2 per cent of taxpayers who earn between $70k and $180k pay 68.5 per cent of tax. Those earning over $180,000, less than two per cent of taxpayers, pay a massive 9.3 per cent of income tax.
“23 per cent of taxpayers are contributing 77.8 per cent of tax. Labour doesn’t seem to think this is enough though. Working Kiwis are taxed heavily but can’t keep up with the Government’s out of control spending. The report’s author says, “real government expenditure is now becoming too high basically for the system to work."
“That’s why ACT would reduce government expenditure, and in turn reduce the amount of money the government takes from hardworking Kiwis. For example, a nurse with one child earning $70k will keep around $2,300 more of their income with ACT’s policies.
“After all, who is better at looking after money than the people who have worked hard to earn it? ACT would cut the 30 percent marginal tax rate to 17.5 percent. We will reverse the 39 percent tax rate and we will reverse the Government’s interest deductibility change. Tax cuts not only give earners more to spend and invest, they also make work and investment pay.
“Under questioning in Parliament last year I got David Parker to admit that the 39 cent rate raises only 0.42 per cent of what Government spends. That’s after the Government raised its spending by 46 per cent in the last three years.
“Labour wants to punish success, that is the very opposite of the values that should be instilled in young people as they develop through school, go on to further study and enter the workforce.
“We will repeal any taxes proposed by Labour, we will get rid of National’s capital gains tax in the bright-line test, we will cut the 30 percent marginal tax rate to 17.5 percent, we will reverse the 39 percent tax rate and we will reverse the Government’s interest deductibility change.
“ACT has a plan to arrest the decline and grow the economy. It would get the country back into surplus and allows New Zealanders to keep more of their income to invest.
“We need to put the values of aspiration in our tax system, making it fairer, simpler and more competitive. It’s not only possible, it’s essential.”