Luxon calls on government for tax relief as cost of living soars

0

National leader Christopher Luxon is calling on the government to provide tax relief to struggling Kiwis as the cost of living rises.

The cost of living has increased by more than 11.5% over the past four years.

The inflation rate from the December 2020 quarter to the December 2021 quarter was 5.9% – the highest annual increase in more than 30 years, according to a Statistics New Zealand report published in January.

READ MORE: Pressure on government to ease pain of rising inflation

In a State of the Nation address on Sunday, Luxon announced that National would cut taxes if he were in government.

He said inflation was at its highest level in 30 years as the cost of basic necessities including food, fuel and housing rose.

“The average Kiwi family is worse off than 12 months ago and the government must act,” he said.

Luxon said one of the “hidden costs” of inflation is “slice creep,” with wage earners paying more taxes due to inflation.

“A middle earner now has a marginal tax rate of 33%. It is not fair.”

He called on Finance Minister Grant Robertson to adjust the three lower income tax thresholds in the upcoming 2022 budget “to account for the inflation we’ve seen over the last four years under the regime. Labour”.

“A family with two average-earning adults would benefit from more than $1,700 a year. Someone earning $55,000 a year would pay $800 less in tax. Anyone earning over $78,100 would earn over $1,000 a year. Additionally, the couple rate for NZ Super would increase by $546 per year on top of the planned increase in April.

“Anyone earning over $14,000 or receiving NZ Super would be better off as a result of these changes. No one will get rich, but they will make things a little easier for Kiwis struggling with the rapidly rising cost of living.”

Income tax inflation reset proposed by National.

Luxon said the changes “would not put additional pressure on inflation or require spending cuts in areas like health and education”, but would “simply force Labor to be slightly less expensive with its new spending in the 2022 budget”.

In mid-December, the government earmarked an additional $6 billion for the 2022 budget, with the additional funds earmarked for the healthcare system and climate change.

READ MORE: Robertson blames government spending for soaring inflation

Luxon went on to say, “Even after factoring in the $1.7 billion cost of these tax cuts, the remaining $4.3 billion would still be the largest allocation ever given to new tax initiatives. expenses.

“It is time for the government to end its massive tax grab. They must act and provide tax relief to hard-working Kiwis struggling with a cost of living crisis.

Share.

Comments are closed.