In-Work Tax Credits Under Debate

October 18, 2012 New Zealand Taxation

Tax Credits for WelfareThe government is considering the proposal to extend in-work tax credits to all beneficiaries, even those not currently employed.

On October 17th Parliament began debating the Income Tax (Universalisation of In-work Tax Credit) Amendment Bill put forward by the Green Party Co-leader Metiria Turei to grant in-work tax credits to all families receiving welfare payments.

Under current regulations the in-work tax credit, of up to NZD 60, is granted as part of the Working for Families package.

The credit is not granted to parents who receive the student allowance or a means tested benefit, or parents who do not meet the minimum requirements for the number of hours worked per week.

If approved, the bill would see the in-work credits paid to all families receiving the benefit.

Metiria Turei claims that approving the bill would help lift 100 000 children above the poverty line, and rejecting the changes is tantamount to discriminating against the poorest children in the country.

At the time of the debate, the Mana Party, the Maori Party, New Zealand First and Labour all indicated that they would support the bill when it is voted on in November.

Representatives of the National Party, Act and United Future indicated that they would be voting against the bill.

Photo by B.T. Indrelunas