New Zealand general election: tax plans and policies of the main parties

This year, the party adjusted Working for Families tax credits in line with inflation.

The $180,000 income tax threshold will remain in place. National has ruled out removing the 39% top tax rate in their first term due to fiscal and economic pressures.

National has indicated it will assess the impact of inflation on the average tax rates at least once every three years, including in 2026.

• The upper limit of eligibility will be extended from $48,000 to $70,000, with abatement of the payment starting from $66,000.
• The lower limit of eligibility will remain the same at $24,000.

• This rebate will be calculated on childcare costs paid, paying back a 25% rebate for childcare costs up to $300 a week.
• National will end Labour’s extension of 20 hours early childhood education (ECE) policy for two-year-olds because this policy will be replaced by the FamilyBoost childcare tax credit.

• Increasing the value of the in-work tax credit by $25 a week (from $72.50 to $97.50), from 1 April 2024.
• Adjusting the abatement threshold for Working for Families payments, up to $50,000 from 1 April 2026.
• Keeping the automatic increases to Working for Families payments that currently exist in law.

• Interest deductibility will be kept at 50% in April 2024 (rather than being reduced to 25% as planned by Labour).
• Interest deductibility will be increased to 75% in April 2025 (rather than being removed fully as planned by Labour).
• 100% interest deductibility will be fully restored from April 2026.
• Take the bright-line test for rental properties back to two years, from Labour’s existing 10 years by July 2024. Properties acquired before July 2022 will not be subject to the bright-line test at sale.

• National will remove the Auckland Regional Fuel Tax and ensure fuel taxes will not be increased in the party’s first term.
• National will remove the Ute Tax. Details on this, including costings, will form the basis of a future announcement.
• National will also remove Labour’s new App Tax on services like Uber and Airbnb and ensure the same GST rules apply to all services.

• A new tax on offshore online gambling operators on proceeds from New Zealanders’ online gambling.
• Higher immigration visa processing fees from 1 July 2024 (there will be no increase to visa fees for the Pacific Islands). National will not allow any fees to cost more than 90% of Australia’s equivalent fees.
• A new 15% foreign buyer tax on the purchase of residential properties worth more than $2 million, and
• Removing the depreciation of commercial buildings for commercial property investors.

• The Green Party will index the tax brackets and adjust them for wage inflation every three years.
• It will introduce a payment of $385 to anyone out of work or studying – with an extra $135 each week for people caring for kids on their own.
• Replace Working for Families with a single payment for parents or caregivers of $215 every week for the first child, and $135 a week for every other child, with an extra $140 a week for every child under three years.
• It will increase the abatement threshold from the current $42,700 to $60,000.
• The abatement rate will change to 18% from the current 27%.
• It will transform the ACC into an Agency of Comprehensive Care so that if anyone has to stop working, they will receive a minimum payment of 80% of the full-time minimum wage.

• A 2.5% Wealth Tax on net assets (such as properties or shares) over the $4 million threshold for couples and $2 million for individuals. Mortgages and other debts will be deducted from the asset total. This will not affect most family homes or retirement savings.
• A Trust Tax of 1.5% on all assets held in private trusts so people cannot move their money into a trust to avoid the Wealth Tax.
• A new top rate of income tax of 45% on income over $180,000.
• Raising the corporate tax rate back to 33%.

• Establish a tax-free threshold of $14,000 by 1 April 2027.
• Adjust tax brackets for inflation starting 1 April 2024, with the first adjustment taking place in 2027 and every three years thereafter.
• Secure a Select Committee Inquiry into GST off basic fresh foods to examine if this would deliver real benefits for taxpayers before legislating for it.
• Reinstate interest tax deductibility on rental property.

Business & economy

• Examine the feasibility of lifting the adult minimum wage to at least $25 an hour by allowing businesses a tax concession to do so.
• Explore the feasibility of introducing a lower business tax rate for SMEs as in Australia.
• Introduce a 100% depreciation rate for business equipment, and an agreed timeline with business, worth up to $20,000 for each item, or a higher sum for approved capital outlay.
• Continue to streamline and simplify tax exemptions for small business.
• Conduct a Select Committee review into the double-taxation of ‘tax like’ instruments such as GST upon rates and excise tax.
• Amend Capital Limitation Rules in the Income Tax Act to treat seismic strengthening as “repairs and maintenance”.
• Examine tax deductions for domestic news subscriptions, press patron subscriptions, and large corporate sponsorships of news outlets.
• Establish a 40% refundable tax offset for eligible games developers spending at least $600,000 on qualifying NZ game development expenditure by 1 July 2024.
• Increase the tax benefits for corporate givers when funding authorised community programmes to 50%.
• Amend the way backdated compensation is taxed so claimants do not pay tax at a higher rate when receiving lump sum payments.
• Undertake a Select Committee Inquiry on the introduction of an exporters tax of 20% for new business or product lines.
• Increase the penalty framework for tax evasion.
• Oppose a comprehensive capital gains tax.

Wealth Tax: The new tax rates will be:

• 0% Net wealth under $2million will not be taxed.
• 2% Tax rate for net wealth over $2million.
• 4% Tax rate for net wealth over $5million.
• 8% Tax rate for net wealth over $10million.
• These rates will be less mortgages and other debts owing and will be for individuals and the combined net wealth of couples. The Net Wealth Tax will not affect most family homes or retirement savings. The tax will be payable annually and will capture capital gains accrued.

Raise the Company Tax Rate back to 33%.

Overseas Financial Transfer Tax, with the rate set at 2%. This will apply to all overseas-owned companies operating in Aotearoa and will be additional to the Company Tax Rate.

Undeveloped Land Tax, which will be payable on all land that has not begun to be developed within four years of purchase. The tax rate will be 33% of the increased land value.

Vacant House Tax, which will be payable on all properties that do not have a tenant after a six-month period. The tax rate will be 33% of the market value.