National promises tax cuts for 16 months to help families through Covid recovery

has announced that it will cut for 16 months from December 2020 to March 2022 to help families during the economic crisis caused by Covid-19. This will also help businesses as boosting after tax incomes boost spending.

I’ve done a quick calculation of what this means for people at different incomes.

The biggest percentage reduction in tax is for those $20,000 and those earning $60,000 and $70,000. After $70,000 the more you earn the less your tax cut percentage is.

In absolute terms anyone who earns $90,000 or more will pay $4,000 less tax during the 16 months which makes a big difference to disposal income. Anyone earning over $60,000 will pay at least $2,500 less tax.

This provides New Zealanders with a real choice – a Government that will help people through the tough times by temporarily reducing taxes, or a Government that will increase taxes.

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