Higher inflation figures show the urgent need to switch to inflation-adjusted tax brackets, says the New Zealand Taxpayers’ Union.
Union spokesman Louis Houlbrooke says, “In 2010, the 30 percent income tax rate was set for income over $48,000. Back then, that was a fairly comfortable salary. But today, due to inflation, you’d need to earn $57,000 to have the same purchasing power. This means that poorer New Zealanders are now getting whacked with the 30 percent marginal tax rate.”
“Successive Governments have got away with this stealth tax hike because inflation has occurred very gradually. But the new higher inflation figures suggest the effect of ‘bracket creep’ is about to get far more painful.”
“Inflation has a nasty effect on Kiwis’ abilities to meet household budgets. The Government shouldn’t be making things worse by exploiting inflation to take even more tax.”
“The Government continuously adjusts benefits and superannuation for the average wage, while the taxpayers who fund these payments don’t even get a measly inflation adjustment. That’s neither fair nor kind.”
“We’re calling on the Government to support Simon Bridges’s bill to end bracket creep. In fact, they should urgently adopt it as Government legislation in response to accelerating inflation.”