New Zealanders fear new government will cut taxes, hike fees – NZ Herald

New Zealand is looking at a new coalition government after Prime Minister Jacinda Ardern and Finance Minister Judith Collins resigned, but some residents of the country’s capital have expressed concern that the country could face new taxes and fees that they fear will cause financial distress.

Key points:New Zealanders are now paying more in income taxes than they ever have before, according to a new report from the Tax FoundationNew Zealand’s tax system has changed significantly since the 1950sNew Zealand has seen a drop in GDP per capita since the 1980s, and has been on the verge of a recession since the mid-1990sNew Kiwis will be able to choose whether to pay income tax on their income or not if they want to, a new survey has foundThe Tax Foundation, which analysed data from more than 700,000 New Zealand households, said New Zealand was one of the most progressive countries in the world when it came to the amount of taxes paid, but had seen a significant drop in its GDP per head since the early 1950s.

“New Zealand was once a land of rising wealth and prosperity.

Now, we have a tax system that is increasingly skewed towards high-income earners, and the burden of those taxes is on those who are already earning more,” said tax analyst David Kober.

The country has had a massive rise in the cost of living in recent years, with median house prices rising more than 300 per cent since the start of the decade.

The Tax Policy Centre found New Zealand had one of its lowest rates of corporate tax compliance, while it had one the highest rates of income tax avoidance, with the highest tax on the value of the value-added tax (VAT) on the highest 20 per cent of incomes.

“The new government, led by Ms Collins, will now have to address these problems.

They are a major reason New Zealand’s economy has been in recession for so long,” said Kober, who has conducted research for the Tax Policy Center since 2004.

The new coalition will likely have to tackle rising costs of living and the cost and burden of the carbon tax, he said.

Ms Arderner and Collins resigned from their portfolios in February, saying they did not feel “the right fit” in a coalition led by a new PM, but their resignation was quickly followed by a resignation of Finance Minister Phil Goff.

Ms Collins had been expected to lead a new government in March, but was replaced by Finance Minister Andrew Little.

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