From today (October 1), our Indian communities will benefit from the biggest changes to our tax system in nearly 25 years.
National has cut personal taxes across the board.
GST has risen to 15%. ‘Working For Families,’ ‘New Zealand Super’ and Benefit Payments will increase by 2.02 % to compensate for the GST increase.
Across-the-board personal tax cuts will put more money in your back pocket.
From today, the average household will be about $25 a week better off, even with the increase in GST. Someone on an average wage will be almost $15 a week better off, and a retired couple, living in their own home and receiving New Zealand Superannuation, will be better off by $11 a week.
To find out how the tax changes will benefit you, please visit the tax calculator at www.taxguide.govt.nz
Superannuitants will get a double boost. They will receive a rise in NZ Super to compensate for the increase in GST and cuts in personal tax.
Personal tax cuts will also apply to any other income such as interest, dividends, or part-time work.
We are also reducing taxes on savings, effective October 1. Resident withholding tax rates on interest will drop to align with the lower personal tax rates and the top tax rate for portfolio investment entities (PIEs) will drop to 28 per cent. Tax rates on managed funds will also drop in coming months.
These changes will increase after-tax earnings on savings.
A single Superannuitant who owns his or own home, with $200,000 of investments generating $10,000 income a year will be about $12 a week better off.
Since mid-2008, thanks to tax cuts and other adjustments, New Zealand Superannuation payments have increased significantly.
The rate for a married couple has risen from $439.80 for each person per fortnight to $511.06 after October, an increase of $71.26 per person per fortnight (16% boost in just over two years).
These tax changes will be a welcome boost to many hard-working Indian families.
They will also help our economy by tilting it towards savings and exports, and away from extra debt, excessive government spending and borrowing for things like property speculation.
The tax changes are an important part of National’s Six-Point Plan for a stronger economy. We want to boost growth and create sustainable jobs.
The second part of the package kicks in next year.
We would drop company tax to 28% encouraging Kiwi businesses to grow and ensure that competitiveness. We are also making changes to property tax to make the tax system fairer and further encourage saving and investment in our businesses.
The Government’s tax package rewards effort and helps attract and retain skilled people in New Zealand.
It will also increase economic growth. According to Budget forecasts, 170,000 new jobs will be created in the next four years.
National is firmly focused on lifting New Zealand’s long-term economic growth to create jobs, boost incomes, and raise the living standards of hard-working Kiwis.
We need to do this so we can provide the world-class public services that all New Zealanders deserve.
We are working hard to provide you and your family with the financial security, opportunities, and higher income you need for a brighter future.
John Key is Prime Minister of New Zealand. The above article is exclusive to Indian Newslink ©