Nats would remove tax ‘burden’

Tax cuts will be a key focus of a National government, party leader Simon Bridges says.

In a ‘‘state of the nation’’ speech in Auckland yesterday, Bridges mentioned taxes 22 times, saying workers deserved a government that removed ‘‘barriers and burdens’’ like tax.

He said New Zealanders on an average wage were almost $4000 a year worse off under the current Government. Median rent was up

$2600 a year due to added taxes and regulations on landlords; petrol taxes had made it $200 a year more expensive for car owners to fill up; and cancelled tax cuts had cost the average earner more than $1000 a year, he said.

National’s focus was on keeping taxes low and growing incomes. Over the next few months Bridges would announce an economic plan which would focus on five packages – tax relief, regulation reduction, infrastructure, small business, and families.

‘‘We will announce our full tax plan that will see people on the average wage better off and keeping more of what they earn,’’ Bridges said. ‘‘People on the average wage should not be paying almost 33 per cent in the dollar.’’

Bridges said the average wage in New Zealand was about

$65,000. By 2022, it would be about

$70,000, he said. ‘‘This is not wealthy in New Zealand.’’

However, the tax department’s tax calculator shows that, based on current tax rates, someone earning $65,000 pays only 19 per cent in tax. Workers who earn up to $14,000 a year, pay 10.5 per cent in tax. Income between $14,000 and $48,000 is taxed at a rate of

17.5 per cent. Between $48,000 and

$70,000 it is 30 per cent and over

$70,000 it is 33 per cent. Because New Zealand taxes income on a progressive basis, someone earning $72,000 does not have every dollar taxed at 33 per cent.

Under the previous National Government, after-tax incomes grew twice as fast as Australia while under the current Government they had grown slower than Australia, Bridges said.

National would also focus on growing the economy by at least

3 per cent per annum.

It would invest more in core public services like health and education, and creating more jobs. To achieve its economic growth target, a National Government would aim to get New Zealand’s growth rate per person to the top half of the OECD.

If New Zealand’s GDP per capita were as good as Australia’s, the average New Zealander would be 35 per cent richer, he said. ‘‘We have slipped to the seventh lowest GDP per capita growth in the OECD.’’

National would aim to reduce the after-tax income gap with Australia, he said. Under the previous National government 10,000 new jobs were being created a month. Under the current Government it was fewer than 1000 a month, Bridges said. ‘‘We need to raise incomes and get people into jobs and we need to attack the cost of living.’’

Finance Minister Grant Robertson said Bridges was promising tax cuts without saying what services he would cut. ‘‘Simon Bridges ... is set to keep creating the same problems we are having to fix now.’’