18 Feb 2024
National will provide meaningful tax relief to working New Zealanders with a plan which will be fully funded through sensible savings, reprioritisations and new revenue measures, National Finance spokesperson Nicola Willis says.
“While Kiwis have been feeling the squeeze and tightening their household budgets, Labour has continued its reckless spending spree and will spend 80 per cent more this year than in its first year in office.
“Too much of this spending has been wasted and not delivered improvements to public services, with crime increasing, hospitals in crisis and educational achievement declining.
“National’s fully-funded tax relief plan carefully targets the squeezed middle to give New Zealanders a meaningful boost directly to their back pockets.
“Our Back Pocket Boost tax relief plan does not require borrowing and will reduce pressure on inflation. It has been designed to be self-funding so that National can guarantee tax relief for working people, even if Labour leaves the government books in a mess, as is predicted.
“Our plan includes reducing spending on back-office bureaucracy and consultants, returning taxes raised on climate polluters to Kiwi families through a Climate Dividend, introducing a 15 per cent foreign buyer tax on the purchase of houses worth over $2 million, ending the commercial building depreciation tax break, closing the offshore gambling tax loophole and moving to user-pays immigration levies.”
National’s tax relief plan will cost a total of $14.6 billion over four years and will be funded by:
- $594 million on average per year reduction in spending on back-office functions in government departments, excluding non-core and frontline agencies
- $400 million on average per year reduction in government spending on consultants
- $590 million on average per year Climate Dividend, returning taxes raised on climate polluters to Kiwi families rather than giving subsidies to large corporates.
Targeted revenue measures:
- $740 million on average per year from introducing a 15 per cent foreign buyer tax on purchase of houses worth over $2 million
- $525 million on average per year from ending the commercial building depreciation tax break
- $179 million on average per year from closing a tax loophole and ensuring offshore operators delivering online gambling to New Zealanders, pay tax
- $123 million on average per year from moving to user-pays immigration levies, excluding tourist visas.
“National will protect health and education spending and ensure that money goes from the back-office to the frontline. We will increase spending in health and education every year in government and ensure that this spending delivers improvements for all New Zealanders.
“Government agencies and Crown entities excluded from the overall spending reductions include the Ministry of Health, Te Whatu Ora, the Ministry of Education, the Education Review Office, Oranga Tamariki, Corrections, Police, Defence Force, NZTA and Kāinga Ora.
“These agencies will still be expected to reduce wasteful bureaucracy spending, but any savings will be recycled into the frontline. All other agencies will be required to find savings and reduce spending.
“People know they can trust National with the economy. It’s been a tough couple of years for New Zealanders, but National will rebuild our economy and reduce the cost of living so that people can get ahead.”
Click here to view National's Back Pocket Boost policy document.