Posted by
Lee Suckling on October 8th, 2008
The much-anticipated opposition tax cut plan has just been released by the National party in the last few minutes, and finally New Zealanders have a clear picture of what John Key has been talking about for several months.
It was revealed yesterday that National would scale back on tax cuts because of the declining state of the New Zealand economy. Breaking news has announced that if elected in the 2008 election next month, John Key plans to put an extra $15 in the average wage earner’s pocket each week above the current tax cut plan offered by the incumbent New Zealand Government.
National plans to, if elected, roll out most of the tax cuts in April next year, while the current Labour party plan sees cuts rolling out slower, culminating in 2011.
John Key will formally confirm figures this afternoon at a press conference in Auckland. Keep tabs on the NZS.com political news headlines for updates.
Posted by
Lee Suckling on October 1st, 2008
After months of waiting, it’s finally October 1, and New Zealanders can look forward to a slightly chubbier pay packet for their first pay period ending in October.
Labour’s tax cuts roll out today, giving Kiwi wage-earners a little extra each week to help with the rising cost of living.
How much more can you expect each week?
Salaries between $20,000 and $30,000 will gain an extra $12 per week ($624 per year); salaries between $40,000 and $60,000 will give you an extra $16 ($832 per year); and $70,000+ salaries will yield an extra $28 ($1456 per year).
This wage bump-up will increase yearly in 2010 and 2011, and to find out exactly how much extra your family is set to receive weekly over the next three years, check out the tax cut calculator on the Labour website.
Unfortunately the world’s financial crisis is again in disarray after the US congress failed to agree on a $1 trillion bail-out plan for the US economy. While the NZ Government and the opposition continued to insist that today’s tax cuts remain affordable, the NZX fell 4.5% yesterday, along with a NZ to US dollar, dropping 2c.
For updates, keep tabs on the latest business news headlines on NZS.com.
Image from Flickr.
Posted by
Lee Suckling on May 27th, 2008
The 2008 Budget has been released – how do you feel about it?
The New Zealand government announced last week that from October 1 it will introduce tax cuts to the tune of $10.6 billion, but media rife leads us to believe many are still unsatisfied with it.
Giving the average Kiwi $16 extra in the hand each week, the tax cut program was dubbed the “Colby Budget” just hours after it was released – signifying it is merely enough to buy a block of cheese with (what is our obsession with cheese in this country?). The Christchurch Press coyly pointed out that they could not find a block of cheese at the supermarket for more than $12.55, which I found quite amusing.
All workers will benefit from the tax cuts, in particular people working on minimum wage salaries. By 2011, when the final stages of the budget are rolled out, it is estimated that there will be 300,000 taxpayers throughout the country who will no longer face the highest tax bracket: 39%, and will instead fall into the 33% category.
Remember that if you earn above any threshold, only the excess in your wages is taxed at the higher rate, not the entire amount.
Here are the details of the cuts:
| Current Rates |
New Rates based on 2008 Budget
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|
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From 1 October 2008
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From 1 April 2010
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From 1 April 2011
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15% to $9,500
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12.5% to $14,000
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12.5% to $17,500
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12.5% to $20,000
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21% to $38,000
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21% to $40,000
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21% to $40,000
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21% to $42,500
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33% to $60,000
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33% to $70,000
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33% to $75,000
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33% to $80,000
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39% over $60,000
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39% over $70,000
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39% over $75,000
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39% over $80,000
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Image from Flickr.
Posted by
Greta Simpson on February 19th, 2008
After keeping his cards very close to his chest, Finance Minister Michael Cullen has confirmed that there will be tax cuts announced in the 2008 budget.
Low surplus won’t hold tax cuts back
Despite a lower than expected Government surplus (for the six months leading up to December 2007, our NZ$815 million operating surplus was NZ$1.7 billion lower than projected), Cullen has said planned tax cuts will go ahead. Surplus figures have been affected by the current volatility of financial markets worldwide – mainly investment losses recorded by the New Zealand Super Fund and other Crown entities.
So, what can we expect in the way of changes to tax in New Zealand?
The tight-lipped one remains cagey on this matter, saying only that he is awaiting further information on tax revenue, spending forecasts and inflation for 2008. As many commentators have noted, tax cuts will not increase our wealth in any real terms; to create a stronger economy and greater wealth for Kiwis, we need increased productivity. This can be achieved through greater investment in research and development, product development, high value technology products, and sectors such tourism. While tax cuts won’t solve our economic woes (house prices, inflation and rising interest rates) or do anything to raise our wage and salary level, they’re obviously pleasing to the minds (and wallets) of New Zealanders.
Stay tuned for more updates on Labour Government’s tax cut policy…
Image from Flickr.
