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Government mulls infrastructure and tax

NZ Newswire logoNZ Newswire 22/04/2017

Finance Minister Steven Joyce has four priorities for next month's budget and is again signalling an interest in ultimately moving income tax thresholds.

He told The Nation programme on Saturday the four priorities were infrastructure, better public services, family incomes and getting the debt down to 40 per cent of GDP.

"For me it's really important that people see the benefit of their work.

"That if somebody moves up from part-time to full-time, they're not hit with, say, a marginal tax rate from the reduction in their family tax credits or something which takes their tax rate so high."

He said there would be evidence of the government "starting" on this issue in the Budget.

"I'm very keen to see us make the tax system work more clearly for people that when they add another hour's work, they can see that they're actually getting significant benefit back in their own pocket."

He said he'd like to move income tax thresholds one day.

"Can I do it this time? Still don't finally know. Maybe."

He said he was scratching his head because the government was spending more on infrastructure and Auckland Council wanted to spend less.

He said Auckland Mayor Phil Goff wants to reduce his transport spend and replace that with a regional fuel tax.

"And we've said, 'No. Actually, why don't you maintain that transport spend?' It's not about increasing rates. It's about how you spend the rates you've got.

"One of the things you'll see in the Budget, of course, is the government's expenditure on the central City Rail Link, which is very significant, and you'll see one of those things in there. You'll also see a bunch of other stuff that we're doing over the next few years."

He said participants in the rail project were "still at the table".

"What we're saying is, 'here's the sort of money that we'll be putting into it'."

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