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New Zealand taxpayers favor increased spending over tax cuts

New Zealand taxpayers favor increased spending over tax cuts

WELLINGTON: New Zealanders believe that tax cuts are important but not a priority, according to research published ahead of the May budget.

A survey of more than 750 people from across the country found strong support among voters for tax reductions in the Budget, either by tax cuts or raised tax thresholds.

Nearly half – 48.6 percent – said that rate tax reductions are “very important.” Another 39.5 percent feel they are “moderately important,” with only 11.9 percent describing them as “not important.”

A majority (53.8 percent) believe the Government should reduce taxes through a combination of cuts to tax rates and raising tax thresholds. Twenty six percent favor reducing tax rates while 20 percent prefer that thresholds be adjusted.

When asked “Who should most benefit from tax reductions?” 71.7 percent of respondents say low income earners, 56.8 percent middle income earners, 6.6 percent top income earners and 8.2 percent businesses.

However, an overwhelming majority of respondents (63.6 percent) said there are more important things for the Government to do with the Budget surplus than reduce taxes. Only 11 percent disagree.

The poll shows very low support for tax reform, in a broad sense, with only 3.7 percent of respondents rating tax reform as their top Budget priority.

“Our poll shows that the Government will have to tread a fine line between delivering on demands for both tax reductions and also channeling greater spending into healthcare, education, and poverty-reduction measures,” said Peter Vial, New Zealand Country Head of Chartered Accountants ANZ, which undertook the survey.