Wednesday, April 24, 2024

Tax relief on the way in upcoming Budget

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Pakuranga MP and Transport and Energy Minister Simeon Brown, left, with Botany MP and Prime Minister Christopher Luxon. File photo supplied
  • By Simeon Brown, Member of Parliament for Pakuranga

Last week, the Government announced our priorities for the coming Budget to be delivered on May 30, which will provide a boost to our economy and set New Zealand back on the right path.

The primary aspect of this will be the delivery of urgently-needed tax relief to hardworking Kiwis, who have been doing it tough over the last few years.

This will include changes to our tax brackets, which have been untouched since 2010 and, when combined with high inflation, have left far too many people paying income tax at a higher rate.

Far too many Kiwis are struggling to keep up with the cost-of-living and we promised, if elected, to do something about it.

With prices skyrocketing in recent years, we know how important it is that you keep more of what you earn to make paying the bills a little easier.

Changes to tax thresholds will not come in isolation and we have announced several other policies to reduce cost pressures and provide further relief.

This includes our policy FamilyBoost which will allow parents to claim back up to 25 per cent of their early childcare education (ECE) costs, to a maximum of $75 per week, or nearly $1000 each quarter, from July 1.

And with our previously-announced repeal of the Auckland Regional Fuel Tax, there will be relief at the pump from July 1 for Aucklanders, who have been paying 11.5 cents per litre extra for fuel over the last six years.

We also announced relief for landlords, with interest deductibility on mortgages restored from April 1, allowing affected Kiwis to deduct 80 per cent of their interest expenses, and 100 per cent from April 1, 2025.

The removal of this deductibility played a role in pushing up rents to record highs as landlords passed on the extra cost, and we expect this change will increase the supply of rental properties and help keep prices affordable.

More detail of these changes and other policies that will make things easier for Kiwis will be announced with our Budget in May, which will be funded through a mixture of savings, reprioritisation of funds and additional revenue sources, and will not require borrowing nor add additional inflationary pressures.

The primary goal over the next few years is to build a stronger, more productive economy and deliver more efficient, effective and responsive public services.

Budget 2024 will begin that process with much-needed tax relief, providing hope to New Zealanders for a better future ahead.

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