After tuning in to watch this morning's new coalition government announcement, we've put together a short summary of the key points in more detail.
Here's what you need to know:
Tax Relief: National's Proposed Changes to Tax Brackets:
As part of National's agreement with New Zealand First, the proposed changes to tax brackets will be progressed as set out in National's Tax plan, but will not include a repeal of the foreign buyer's residential property ban, with income tax reductions coming into force from 1 July 2024.
Restored interest deductibility on rentals and a two-year bright line test:
No announced changes
On investment properties, National has said it will gradually reinstate 100% interest deductibility. This will happen in increments over the next three years. The bright line test, which is currently set at 10 years, would be reduced to two years.
Family Boost and Working for Families:
No announced changes
FamilyBoost is a new initiative that would provide a rebate for childcare costs of up to $150 a fortnight, reducing for higher incomes. National has also proposed an increase to the existing Working for Families in-work tax credit. Together with the new tax brackets, National says a couple with young children, with a household income of $120,000, would have up to $250 a fortnight more in hand.
Other:
- Assessment and response to the impact of energy prices on inflation, and the impact of inflation on average tax rates will be assessed by 2026.
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“Moderate” increases to the minimum wage each year.
ACT's policy to speed up the restoration of interest deductibility has been adopted, along with the parties tenancy law proposals like a "pet bond"
A Regional Infrastructure Fund, proposed by New Zealand First, will have $1.2 billion in capital funding.
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Public sector agencies will each have expenditure reduction targets “informed by the increase in back office headcount at that agency since 2017.
We’ll keep you posted on further updates and changes to the above will impact you:
We will be watching closely as the new coalition Government makes decisions on the above – and we’ll keep you updated. If you have questions about what this could mean for you or your business, we’re here to help.
If you wish to discuss how any of these announcements might impact you or your business, please contact us on 04-970-1182.
