2020 Election: Labor Raises Top Tax Rate for Big Money Earners

The work promises a new top tax rate of 39 percent for people who earn more than $ 180,000 a year, a tax that will only affect 2 percent of New Zealanders.

The new tax would affect those who earn $ 200,000 a year about $ 23 a week, $ 1,200 a year, but would generate up to $ 500 million a year.

The money collected with the tax would go to health, education, debt control and support for the country’s Covid-19 recovery.

Party finance spokesman Grant Robertson said the tax was to maintain investment in important services for New Zealanders, while the tax rate was exactly the same for the vast majority of the country.

“Our plan strikes a balance as we recover from Covid-19,” he said.

“It will avoid the cuts to services suggested by the National Party, and it will also help control debt as we support economic recovery from a 1 in 100 year shock.”

It is about the highest earners in New Zealand offering “a little more” to help pay for essential services in the country, in the wake of Covid-19.

For 98 percent of the country, Robertson said there would be no changes to income tax.

“Labor will not implement any new taxes or make any additional increases to income tax next period,” Robertson promised this morning.

This is in addition to Labor’s promise not to raise fuel taxes if he wins re-election in October.

“Our team of five million is doing an outstanding job fighting Covid-19. It is important that people’s incomes and services are protected as we recover and rebuild.”

Earning income spokesman Stuart Nash said that in Australia, people who earn more than A $ 180,000 a year pay a tax rate of 47 percent.

In fact, the new upper tax bracket still means that New Zealand is in the bottom third of the 36 OECD countries when it comes to a top tax rate.

The company’s tax rate will not change, Nash confirmed.

He said this would give the companies “continuity and certainty.”

Robertson said the new tax revenue would also help pay off New Zealand’s debt, debt taken on to help revive the economy as it battles the economic fallout from Covid-19.

“I have focused during this term in office on managing our books carefully and reducing debt. That approach will continue.”

Meanwhile, Nash said a Labor government is prepared to implement a digital services tax (DST).

Current IRD projections estimate that a DST will generate between $ 30 million and $ 80 million in revenue a year, he said.

What the tax thresholds would look like under a re-elected Labor government:

• Any income up to $ 14,000: 10.5%

• Additional income of more than $ 14,000 and up to $ 48,000: 17.5%

• Additional income of more than $ 48,000 and up to $ 70,000: 30%

• Additional income of more than $ 70,000 and up to $ 180,000: 33%

• Additional income over $ 180,000: 39%