Te Pāti Māori has unveiled an ambitious tax policy, claiming it would lower the income tax of 97% of New Zealanders, writes Henry Oliver in today’s excerpt from The Bulletin.
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At a press conference yesterday, Te Pāti Māori co-leaders Debbie Ngarewa-Packer and Rawiri Waititi laid out a nine-point plan they described as a “Kiwi tax plan” – a rebranding of policies they had campaigned on in 2023, with some revisions and one brand new proposal.
“This is about kai,” Ngarewa-Packer said, reported by The Spinoff’s Lyric Waiwiri-Smith for The Bulletin. “This is about being able to put fuel in your car. This is about being able to buy nappies, and this is about being able to afford your power bill. And to us, this is about breathing room, this is the difference between getting through the week and constantly falling behind.”
The centrepiece of the plan is an income tax restructure that would see the first $30,000 of earnings tax-free. The party says 97% of New Zealanders would pay less income tax, with around 4.2m people receiving “on average, an additional $4000 a year.”
A 5% stamp duty and other revenue
The most significant new policy is a 5% stamp duty on residential property sales, with exemptions for first-home buyers purchasing properties under $1m, RNZ’s Russell Palmer reported. The tax would be expected to bring in $2.1bn.
Other revenue measures include a wealth tax (1.5% on net wealth above $2m, rising to 2% for wealth above $5m, and 2.5% for $10m or more); returning the company tax rate from 28% to 33%; a 5% international profit transfer tax on profits shifted offshore; land-banking and vacant house taxes at 33%; and $1bn to tackle serious fraud, tax avoidance and tax evasion
The party projects the full package would raise $20bn in revenue, with $16bn in expenditure – leaving a net surplus of around $4bn.
Kai credit replaces GST removal from fresh food
The party has revised its previous promise to remove GST from fresh food. Instead, it is offering a targeted “kai credit” for people earning $60,000 or less per year. Ngarewa-Packer said the credit would be “worth up to eight weeks of kai each year” and would reach around 3m people, or 64% of the population.
When asked for a dollar figure, she said it would be “around about $1,000 per person” in that tax bracket. “We want to be able to be fair, and we want to be able to make sure that what we’ve designed works.”
‘We are not interested in changing the government simply to change the people sitting around the cabinet table’
National campaign chair Simeon Brown (who stated the obvious yesterday, saying that “tax is going to be a core part of this year’s campaign”) quickly responded, saying the policy confirmed “every single part of Chris Hipkins’ coalition wants to increase your taxes,” RNZ reported. “This is the biggest tax grab in New Zealand’s history.”
The Post’s Henry Cooke reported the policy has little chance of being enacted, as Labour (Te Pāti Māori’s only potential coalition partner) has ruled out major tax changes outside of its capital gains tax.
But Waititi was clear about the party’s position. Asked for his message to Labour leader Chris Hipkins, Waititi replied: “I will see you on the eighth” – the day after the election.
The party described the tax plan as a “bottom line” for any coalition negotiations. “We are not interested in changing the government simply to change the people sitting around the cabinet table,” Ngarewa-Packer said. “We are here to transform what government does.”
“This isn’t about Māori versus non-Māori, or workers versus business,” she said. “It’s about building an economy that works for the overwhelming majority of people who call Aotearoa home.”
