I am interested in tax policy from some of the right and left wing parties in New Zealand. Below is my calculations as to how much tax you'd pay if ACT or National got their way, and how much you DO pay in New Zealand under the current tax rates.
ACT Policy
A lower rate of 15% for incomes up to $38,000. This is affordable and would boost economic growth rates by 1%.
ACT proposes a flatter, simpler tax system of just two rates:
a top tax rate (and company tax rate) of 25%
Therefore if you earn $65,000 you will pay:
$38,000 x 15% = $5,700
$27,000 x 25% = $6,750
total tax = $12,450
National Policy
The new tax rates and thresholds would be:
A company tax rate of 30%.
Income up to $12,500 will be taxed at 15%.
Income between $12,500 and $50,000 will be taxed at 19%.
Income between $50,000 and $100,000 will be taxed at 33%.
Income above $100,000 will continue to be taxed at 39%.
Therefore if you earn $65,000 you will pay:
$12,500 x 15% = $1,875
$37,500 x 19% = $7,125
$15,000 x 33% = $4,950
total tax = $13,950
Labour Government ( current tax )
Income up to $38,000 IS taxed at 19.5%
Income between $38,001 and $60,000 IS taxed at 33%
Income $60,001 and over IS taxed at 39%
Therefore if you earn $65,000 you pay:
$38,000 x 19.5% = $7,410
$22,000 x 33% = $7,260
$ 5,000 x 39% = $1,950
total tax = $16,620
So if you earn $65,000 NZ per year, under Labour you now pay $16,620.
Under National policy you'd pay $13,950, saving $2,670
Under ACT policy you'd pay $12,450, saving $4,170
and keeping a further $1,400 in your pocket over National policy.
Now it seems that tax cuts didnt really matter too much to the voters in the election this time. But an extra $2,670 - $4,170 in your pocket would allow you to spend more, therefore boosting the economy. With a lower corporate tax companies would invest or re invest into NZ and everything should boost from there. Higher taxes are not the answer....... Now social welfare has to be taken into account, and defence needs to be worked in as well, but with the current surplus available I'd predict that before that gets consumed the economy would be roaring ad the tax intake would be higher than it is now.........
So next time make sure you make a tactical decision to vote right allowing ACT the party vote and electorate vote in decided electorates, and Voting National for the candidate in the rest of the electorates.
4 comments:
hmm I voted by process of elimination. I had to forget about the tax side of things or it would get depressing. You see Labour were the only ones who weren't going to shut down or totally sabotage the NZ film and tv industry ... so if anyone apart from Labour got in, I'd have to move to aussie to make a living. Didn't leave me much choice. I figured out who I wasn't voting for and then went from there.
Well I would have thought that a lower tax would have created an opportunity for the tv and film industry to invest more. Why dont you ask the leaders of all the parties what ther e policy is towards film and television production in NZ. I was at an awards evening in Beverly Hills and Rob Tapert ( lucy Lawless' husband ) was going on about his disappointment with the closure in investment and tax breaks for filming in NZ. Sounds like if you want better breaks you best vote right.
Exactly.
I didn't read any policy from National or ACT that said they will sabotage the NZ tv and film industry.
You would think that the more money people, and businesses have in their pockets, the better off they would be to invest in such ventures.
Less tax, more personal money. More personal money, more to invest. Is that hard to figure out?
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