ACT tax policy

is campaigning on restricting future increases in Government expenditure to inflation and population growth. This means only increase spending by 3.6% a year instead of 6.0% a year. An admirable goal.

Their tax policy, released today, means that in ten years, tax rates will be:

  1. 12.5% personal tax up to $20,000
  2. 15% personal tax over $20,000
  3. 15% company tax
  4. 10% GST

If that was possible (and I have real doubts that you can restrict Government spending to inflation/population as it means no new initiatives for ten years – but it is a laudable goal), then we would have a superb low tax environment which would grow much much faster, closing the gap with Australia and the world. And households would have much much more after tax income.

Well done ACT on a great policy.

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