“ACT knows Kiwis are struggling, not just with a cost of living crisis, but a tax crisis too. That's why we would return the revenue collected from the Emissions Trading Scheme (ETS) to them in the form of a Carbon Tax Refund. That would mean a $1558 payment in the next fiscal year to a family of four,” says ACT’s Climate Change spokesperson Simon Court.
“The Carbon Tax Refund would take each year’s revenue from ETS auctions and divide it by the population. Every adult would receive a reduction in their tax bill by that amount, plus their dependent children’s share. For people whose tax bill was lower than this credit, any remaining amount would be paid directly to them by Inland Revenue.
“ACT is proposing to give the money collected through the ETS back to Kiwi families to help with the rising cost of living.
“This plan will not touch a cent going to health, education, police, or any other public service.
“ACT’s plan will guide people towards lowering their emissions because if they spend money on carbon-heavy things, their money goes back into the ETS; if they take low carbon options, they avoid ETS charges.
“In fact, this policy would be good for New Zealand’s long term commitment to climate change. If the ETS gives people a carbon dividend, it is far more likely to be politically sustained over the decades as carbon prices inevitably rise, but the best way to benefit is to take the money and use less carbon.
“ACT’s Carbon Tax Refund would offset much of the impact on the cost of living due to the ETS. But it would retain the incentive to reduce emissions, because, for instance, the ETS tax would remain on every litre of petrol purchased.
“The benefits of this policy would be felt most strongly by those on low and middle incomes. A payment of $390 makes a much bigger difference to someone on $30,000 than $180,000.
“This is yet another positive proposal from ACT to help Kiwis who are being squeezed from every direction.
"ACT would also:
Deliver a middle-income tax cut:
• Reduce the middle-income tax rate from 30% to 17.5%. Our plan will allow the average full-time worker to keep $2,000 more a year to help deal with the rising cost of living. That’s almost $40 more a week in the pockets of hardworking taxpayers to help them with the cost of life.
Cut wasteful spending:
• Zero base the public service by going back to zero and ask ourselves, if the departments and bureaucracies we have now didn’t exist, would we establish them today.
“ACT’s package of solutions will make life more affordable for middle New Zealand. Parents shouldn’t have to choose between swimming lessons for their kids and tank of petrol. We will keep listening to the concerns of New Zealanders and pushing for better solutions to make life more affordable for Kiwi families. We hear ya.”