Opinion by Keith Rankin.
Do we need real income-tax cuts this year? Probably not.
Do we need nominal income-tax cuts? Yes, we do.
The government should go ahead with its proposed tax cuts, but only to low and middle income earners.
The tax cuts should compensate for the inflationary component of the cost of living crisis. But high income earners – eg people receiving incomes in excess of $160,000 per year – should be willing to make a small sacrifice for the greater good.
To do this, the government – if it wants to be re-elected, and if it wants to do the right thing – should go ahead with its tax reduction policy; as per the National Party 2023 election campaign promise, but with one proviso.
The government should lower the top tax threshold of $180,000 to about $160,000.
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Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.
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