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ACT unveils tax cuts plan

NZ Newswire logoNZ Newswire 11/05/2017

The ACT Party has unveiled a tax cuts plan that would see income and company tax reduced.

Leader David Seymour says its affordable and could be done without cuts to core services such as health, welfare, infrastructure or the police.

"ACT's fundamental belief is that the government should spend less of your money," he said.

"The government is currently forecasting fat surpluses - this excess revenue should be returned to the taxpayer."

Mr Seymour says the plan has been fully costed and could be funded using a combination of forecasted surpluses "and cuts to waste and corporate welfare".

These are the tax rates he's proposing:

Company tax

* Cut from 28 per cent to 25 per cent

Income tax:

* $0 to 14,000 - 10 per cent (current 10.5 per cent)

* $14,000 to $48,000 - 15 per cent (current 17.5 per cent)

* $48,000 to $70,000 - 25 per cent (current 30 per cent)

* Over $70,000 - 25 per cent (current 33 per cent).

ACT would also require the government to continually adjust tax bracket thresholds for inflation.

"This will end stealth taxation by bracket creep," Mr Seymour said.

Finance Minister Steven Joyce has said he doesn't plan to cut tax rates in the budget he'll present on May 25.

He could adjust thresholds as part of a family support package.

Spending watchdog the Taxpayers' Union, which campaigns for tax cuts, was disappointed.

"We were expecting something more ambitious from David Seymour," said executive director Jordan Williams.

"ACT has tied its tax package to measures to reduce corporate welfare - according to our calculations, even if Steven Joyce refused to cut any of that spending ACT's tax relief package is still affordable and within surplus amounts."

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