Tax Cuts on the Horizon for New Zealand
May 16, 2016 Taxation in New Zealand
WELLINGTON – The government of New Zealand is aiming to cut tax rates and reduce tax thresholds on individuls’ incomes, if the national budget surplus can be raised to approximately NZD 3 billion.
In a radio interview on May 16th the Prime Minister of New Zealand John Key indicated that individual taxpayers may see some tax cuts in the foreseeable future, but not in the coming year.
The Prime Minister explained that in order for the government to initiate cuts to the rates of tax paid by individuals, the country would first need to see a budget surplus of approximately NZD 3 billion.
He added that it is unlikely that the country will see the a high enough surplus to pay for the tax cut, but the possibility exists for 2017.
The Prime Minister went on to say that the government will soon need to also evaluate tax thresholds, as the average salary in New Zealand will soon reach the top threshold for income taxes.
Tax cuts were expected to be announced in this year’s national budget plan, but due to the size of the budget surplus expected to be seen this year, the potential tax cut would have only provided tax reductions of approximately NZD 8 per week per household.
Photo By: Ari Bakker