Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Government Fulfils Election Undertaking On New Top Tax Rate

Hon Grant Robertson

Minister of Finance

Hon David Parker

Minister of Revenue

The Government will today keep its election promise to put in place a new top tax rate of 39 per cent on income earned over $180,000.

“This will only affect the top two per cent of earners. It is a balanced measure that is about sharing the load so everyone is doing their bit to help our country rebuild after our fight against the Covid-19 virus,” Finance Minister Grant Robertson said.

“It is also about keeping a lid on debt while ensuring we can maintain our investment in health and education. For 98 per cent of earners there won’t be any change.”

It’s important to remember too that this is for individual income. So if a couple together earn over $180,000 but individually earn less than that amount, then there is no change at all to the amount they have to pay.

The new rate will apply from 1 April 2021.

Revenue Minister David Parker said the Government is aware that some people may seek to escape the higher tax rate and shelter their income in trusts, and commentators often make such comments when changes to the top tax rate are proposed.

“This bill includes powers to collect information from trustees to test compliance and the effective operation of the 39 per cent tax rate and to further understand what trustees do with trust assets and income,” David Parker said.

“If trusts are used for the sole purpose of paying a lower tax rate, it is unfair to all those New Zealanders that pay the right amount of tax. If there is evidence of this type of behaviour we will move on it.”

As well as the rate change, the Bill contains a number of consequential changes and a proposed threshold change to the minimum family tax credit.

Changes to the minimum family tax credit comes about as a result of an increase in the main benefit in March by $25 a week.

The adjustment results in a $32 per week increase in the 2020/21 tax year for those receiving the minimum family tax credit. The change ensures that families are better off in the workforce than being on the benefit.

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Demise Of The Tokyo Olympics

As the Covid vaccines roll out around the world, the Tokyo Olympics are looming as a major test of when (and whether) something akin to global normality can return – to international travel, to global tourism, to professional sport and to mass gatherings of human beings. Currently though, it looks like a forlorn hope that Japan will be able to host the Olympics in late July. Herd immunity on any significant scale seems possible only by December 2021, at the earliest... More>>


New Zealand Government: Cook Islanders To Resume Travel To New Zealand

The Prime Minister of New Zealand Jacinda Ardern and the Prime Minister of the Cook Islands Mark Brown have announced passengers from the Cook Islands can resume quarantine-free travel into New Zealand from 21 January, enabling access to essential services such ... More>>


A New Year: No politicians at Rātana in 2021

Annual celebrations at Rātana pā will be different this year, amid a decision to hold an internal hui for church adherents only… More>>


Government: Pre-Departure Testing Extended To All Passengers To New Zealand

To further protect New Zealand from COVID-19, the Government is extending pre-departure testing to all passengers to New Zealand except from Australia, Antarctica and most Pacific Islands, COVID-19 Response Minister Chris Hipkins said today. More>>


Covid: Border Exception for 1000 International Students

The Government has approved an exception class for 1000 international tertiary students, degree level and above, who began their study in New Zealand but were caught offshore when border restrictions began....More>>





InfoPages News Channels