Wednesday, June 19, 2024

Tax Bill passed by Parliament

Average-income households will be up to $102 a fortnight better off from 31 July following passage of The Taxation (Budget Measures) Bill in Parliament today, according to Finance Minister, Nicola Willis.

“The Bill gives effect to the coalition Government’s promise to allow New Zealanders who have been experiencing a prolonged cost of living crisis to keep more of their own money.

“More than 3.5 million Kiwis will benefit, on average, by $32 per fortnight from the bill which passed its third reading under urgency.

“People can see how much they personally will benefit from the tax changes by using the tax calculator at Budget.govt.nz/taxcalculator,” Ms Willis said.

The Bill adjusts the bottom three tax thresholds, extends eligibility for the independent earner tax credit, increases the in-work tax credit, lifts the minimum family tax credit and introduces the FamilyBoost payment for families with children in early childhood education, she said.

The adjustment to the lowest tax threshold will reduce income tax for everyone earning more than $14,000 a year.

“The other changes tilt the benefits of the package towards low to middle-income working families with children, those who have been hardest hit by rising prices.”

“Analysis from the Treasury shows that an estimated 727,000 households will benefit by at least $75 a fortnight, and 187,000 will benefit by at least $100 a fortnight.”

On average, households will benefit by $60 a fortnight, and households with children by $78 a fortnight, said the Minister.

She said the package aligns with the National Party tax plan with some adjustments to reflect coalition agreements.

“The 31 July implementation date gives employers and payroll providers time to make necessary changes.”

“The package is fully funded so it won’t add to inflation pressures. Some of the funding is from revenue measures but mostly it comes from savings,” said Ms Willis.

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