TOP have announced:
- $13,000 annual universal basic income (UBI);
- $2,080 annual child universal basic income (paid to parents);
- Flat tax of 33% on all income from all sources for all entities; and
- Risk free return method (RFRM) tax on assets.
The policy has the sums attached to it and adds up, but there are some issues around it which are glossed over.
The first and biggest is that the UBI is $250 a week. Current NZ Super is $423 a week so they are proposing a 39% reduction in the level of NZ Super.
Secondly while it is great for those without kids, those on middle income with kids would get less. Take a one income family on $50,000 with 2 kids.
Their current situation is:
Net Tax -$4,512
Under UBI it is:
UBI Adult: 13,000
UBI Kids: $4,160
Net Tax: -$660
So they are $3,852 worse off. Again not going to be popular campaigning to cut the income of low income families.
Also worth noting the 1% annual property tax. So if you are retired but in a $1 million home you also get a $10,000 annual property tax bill.