New Zealanders are working hard, but many are struggling. We can see costs rising, but incomes are not increasing to match. We need to invest in our people and build a fairer economy that works for everyone. An economy where people can afford to pay for groceries, a home, education, and most importantly a secure future for them and their families.

Our vision:

We want to ensure that every New Zealander has the financial security to afford the essentials. We will increase incomes and rebalance the tax and welfare systems to ensure that everyone, not just workers, are paying their fair share.

Our higher incomes package will:

  • Introduce a Universal Basic Income to give New Zealanders the financial security to enable them to prosper.
  • Tax all incomes fairly to remove loopholes and ensure property owners pay their fair share.
  • Remove welfare sanctions to create a system that rewards work, rather than punishes it.
  • Ensure that polluters pay for their environmental impact.

We know that a transformative policy like this cannot be delivered overnight. That's why we have developed a phase-in plan that will allow us to introduce our package in two stages.

In Phase 1, we will:

  • Introduce an income tax-free threshold of $15,000 p.a.
  • Replace the current income tax thresholds with three simple tax rates - 20% (for income between $15,000 and $80,000), 35% (for income between $80,000 and $180,000) and 39% (for income above $180,000).

Income Tax (proposed)

To understand how much better off you’d be with our new income tax thresholds:

  • With an annual income of $15,000, you’ll have an extra $1,645 a year.
  • With an annual income of $30,000, you’ll have an extra $1,270 a year.
  • With an annual income of $45,000, you’ll have an extra $895 a year.
  • With an annual income of $60,000, you’ll have an extra $2,020 a year.
  • With an annual income of $75,000, you’ll have an extra $3,670 a year.

The income tax-free threshold and new income tax rates will deliver approximately $6.35 billion of tax cuts to hard-working Kiwis. While the tax free threshold will increase incomes for everyone, it will be most beneficial for the approximately 1.7 million New Zealanders on low and medium incomes.

To pay for this we will:

  • Introduce a land value tax of 0.75% - a small annual tax paid on the value of urban residential land.

Commercial, rural, conservation and Māori land will be excluded from paying the land value tax.

Superannuants could opt to defer payment until there is a change in ownership of the property.

We estimate the land value tax will raise approximately $7 billion p.a. making Phase 1 of our plan fiscally neutral.

This tax switch will rebalance the system by easing the tax burden of wage earners and making sure that land owners are paying their fair share.

We will also:

  • Remove unfair and unreasonable sanctions on benefits, such as your relationship status determining benefit allowances.
  • Increase income support for people with disabilities ($400 million).
  • Make it easier for those with disabilities to access the support they need by streamlining processes and improving their accessibility.
  • Wipe all Ministry of Social Development debt ($2 billion) to ease the financial burden on low-income communities.
  • Extend the In-Work Tax Credit (IWTC) to all children of low-income families ($500 million).

See Phase 2

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