United Future calls for tax reductions now [correction to earlier release]

United Future finance spokesperson Gordon Copeland has today called on the Government to reduce taxes across the board given the pattern of rising surpluses revealed in the Budget Policy Statement.

“It needs to be remembered that the projected surpluses ($3.5 billion in 2002/03 rising to $5.2 billion in 2005/06) effectively amount to a bonus in Government’s favour flowing from the hard work of New Zealanders many of whom struggle, on a daily basis, to make ends meet.

“This provides the Government with an excellent opportunity to signal a tax reward for everyone so we would like to see an immediate commitment in 2002 not 2004 to :

* An adjustment to personal income tax bands for inflation since 1 April 2000. This is no more than fair play and would immediately boost the income for thousands of New Zealanders.

* A reduction in the company tax rate from 33 cents to 30 cents.

* A lift in the level of family support payments to cover inflation since 1998 and into the future as a way of reducing child poverty.

Tax cuts in relation to long-term savings through superannuation funds. United Future favours both a tax rebate on the first $2,000 saved each year and reductions, to align with personal marginal tax rates, on both employer contributions and fund earnings.

“There is room to move and it’s time to pass some of the benefits of our economic growth back to New Zealanders and their families. In particular child poverty needs to be addressed hence our call for a lift in the level of family support payments by way of indexing for both past and future inflation.

“These tax cuts would be good for growth and create a foundation for our future prosperity. In addition they would signal to all New Zealanders that the Government is prepared to use its new-found wealth to establish a pattern of putting funds back into people’s pockets, at regular intervals, so that the benefits of economic growth are enjoyed by all,” said Mr Copeland

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