Auckland Will Not be Allowed to Raise Tax

February 14, 2012 New Zealand Taxation

Auckland City Council Will Not Charge New TaxesThe Auckland City Council’s plan to instate several new taxes has been dashed following comments made by the Prime Minister of New Zealand.

While giving a television interview on February 13th, the Prime Minister of New Zealand John Key indicated that the government would not approve a request by the Auckland City Council to raise a number of local taxes in order to help pay for new infrastructure projects.

Earlier last week the Auckland City Council revealed that it is currently investigating the feasibility of increasing taxes levied throughout the region to help raise an extra NZD 2.4 billion, in order to pay for a new inner-city rail system. The Council is currently considering hiking petrol taxes, introducing a regional income tax, increasing local property rates, raising road tolls, and possibly even raising GST on goods sold in the Auckland region.

The Prime Minister said that in order for the Council to raise taxes across the region, permission would first need to be granted by the government. However, he went on to say that “… any tax sucks money out of the economy, we have to be cautious with that and consider whether it’s warranted”.

Despite downplaying the possibility of the proposed tax increases, the Prime Minister praised the Auckland Council for seeking out public opinions on its infrastructure funding options, saying, “… whenever you put another cost on households you have to think about how they’re going to pay for it – and I’m thinking very carefully through this one.”

Photo by The.Rohit