New Zealand Real Wages Will be Boosted
September 21, 2010 New Zealand Taxation
According to the New Zealand Government, the real after-tax wages of New Zealanders will increase on October 1st when scheduled tax changes come into effect.
On September 21st Bill English, New Zealand Finance Minister, released new estimates by the New Zealand Treasury showing that in the quarter from October 1st to December 31st real after tax average earnings of national taxpayers will rise by 1.2 percent. According to the Minister, the estimates take into account all major cost of living indicators, personal tax rate decreases, portfolio investment entity (PIE) tax rates, and the upcoming the goods and service tax (GST) rate increase.
On October 1st the national GST rate is scheduled to rise from the current rate of 12.5 percent to 15 percent. The top tax rate applied to PIE investments will be 28 percent. All personal tax rates will also fall, with corresponding decreases on resident withholding tax rates.
According to Bill English after October 1st an average New Zealand family will be approximately NZD 25 better off per week. While a typical wage earner’s financial situation will improve by nearly NZD 15 per week. The Minister added that these improvements will grow even further with time. He added that “At all taxable income levels, the personal tax cuts will more than offset the rise in GST – and low, middle and high income groups broadly receive the same proportionate increase in disposable income.”
Photo by Ewan-M