Questions Raised About Green’s Tax Hike
August 21, 2014 New Zealand Taxation
An independent review has cast some doubt over the tax changes proposed by the Green Party.
The projections completed by the Green party regarding its proposed changes to personal income taxes may have been overly optimistic, and may not raise the revenues expected by the party, according to information in a new report completed by the independent auditor Infometrics.
The Green Party has proposed that the top marginal rate of income tax should be hiked to 40 percent on incomes exceeding NZD 140 000 per year, and that the tax rate for trusts should be matched at 40 percent.
The changes were projected to raise as much as NZD 1 billion a year, to be used for projects to prevent child poverty.
However, according to the findings detailed in the report by Infometrics, the projected tax revenue is overly optimistic, as the schedule for the implementation of the tax may be too short, and because the proposal doesn’t take into account any changes that wealthy taxpayers may make to their affairs in order to reduce their tax exposure.
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