Election 2026 Policies

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#3509647 9-Jul-2026 11:34

MikeAqua:

geek3001:

Cue an increase in retail electricity costs to cover that.

This is why we're going fully off grid in the new build. No utilities of any kind. No way for the utilities industry to get it's rapacious claws into us. We will incur a high capital cost up front (not as much as you'd expect though). But ... our home will then be energy self-sufficient.

Nice!

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#3509735 9-Jul-2026 14:41

MikeAqua:

This is why we're going fully off grid in the new build. No utilities of any kind. No way for the utilities industry to get it's rapacious claws into us. We will incur a high capital cost up front (not as much as you'd expect though). But ... our home will then be energy self-sufficient.

This is my plan for my next house. The cost to simply exist in a home before you've fed, clothed and made healthcare provisions for any of the occupants is like an out-of-control freight train in NZ.

One party wants to tell me that an income that barely covers that cost is now going to attract a top rate of 45% and treat me like a plutocrat.

In their defense, they win points for 'something is better than nothing' at least; the two major parties seem to think the status quo is acceptable.

SaltyNZ

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#3509740 9-Jul-2026 15:19

GV27:

One party wants to tell me that an income that barely covers that cost is now going to attract a top rate of 45% and treat me like a plutocrat.

In their defense, they win points for 'something is better than nothing' at least; the two major parties seem to think the status quo is acceptable.

Both my wife and I will be very much caught by that too so believe me I 100% get your point*, but remember that it is partially offset by a tax-free band and tweaks to the other lower bands. More importantly there are other announcements coming as we move along in the campaign.

*IMO nobody that gets their income from a wage is "wealthy". If you need a job to survive you're two missed paydays from WINZ, regardless. Personally I would have left the top rate alone and made the wealth tax 3% or 3.5% to make up the difference. When your net wealth exceeds $16M, the wealth tax isn't making you poorer, it's just making you get richer a bit less quickly. But I am not a tax expert and I was not on that policy committee.

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#3509744 9-Jul-2026 15:30

SaltyNZ:

GV27:

One party wants to tell me that an income that barely covers that cost is now going to attract a top rate of 45% and treat me like a plutocrat.

In their defense, they win points for 'something is better than nothing' at least; the two major parties seem to think the status quo is acceptable.

Both my wife and I will be very much caught by that too so believe me I 100% get your point*, but remember that it is partially offset by a tax-free band and tweaks to the other lower bands. More importantly there are other announcements coming as we move along in the campaign.

*IMO nobody that gets their income from a wage is "wealthy". If you need a job to survive you're two missed paydays from WINZ, regardless. Personally I would have left the top rate alone and made the wealth tax 3% or 3.5% to make up the difference. When your net wealth exceeds $16M, the wealth tax isn't making you poorer, it's just making you get richer a bit less quickly. But I am not a tax expert and I was not on that policy committee.

It's not like it's ever going to survive coalition negotiations anyway. It's marketing not policy.

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#3510881 13-Jul-2026 10:14

GV27:

This is my plan for my next house. The cost to simply exist in a home before you've fed, clothed and made healthcare provisions for any of the occupants is like an out-of-control freight train in NZ.

One party wants to tell me that an income that barely covers that cost is now going to attract a top rate of 45% and treat me like a plutocrat.

In their defense, they win points for 'something is better than nothing' at least; the two major parties seem to think the status quo is acceptable.

At 45% you aren't working for yourself, you're mostly working for the government. By the time you spend that money, between the PAYE you paid earning it and the GST you'll pay spending it, the govt is getting more than half of those particular earnings. If you spend it on booze or petrol, it's even worse.

I think you'd see some interesting behaviours emerge, people negotiating more leave instead of pay increases, not working hard enough to achieve bonus targets. I've done both of those under the top tax rate introduced by the last Labour government.

Mike

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#3510903 13-Jul-2026 11:07

MikeAqua:

GV27:

This is my plan for my next house. The cost to simply exist in a home before you've fed, clothed and made healthcare provisions for any of the occupants is like an out-of-control freight train in NZ.

One party wants to tell me that an income that barely covers that cost is now going to attract a top rate of 45% and treat me like a plutocrat.

In their defense, they win points for 'something is better than nothing' at least; the two major parties seem to think the status quo is acceptable.

At 45% you aren't working for yourself, you're mostly working for the government. By the time you spend that money, between the PAYE you paid earning it and the GST you'll pay spending it, the govt is getting more than half of those particular earnings. If you spend it on booze or petrol, it's even worse.

I think you'd see some interesting behaviours emerge, people negotiating more leave instead of pay increases, not working hard enough to achieve bonus targets. I've done both of those under the top tax rate introduced by the last Labour government.

It's the same top tax rate as Australia. So, what happens there?

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#3510910 13-Jul-2026 11:36

The Laffer curve generally doesn't peak until income tax gets really high - around 70%. It turns out people still like money.

The bigger issue is when you have stacked incentives which cause actual income to drop around certain thresholds. This happens in the UK at £100k where the effective income tax rate between 100k and 125k is 60% as well as losing access to childcare subsidies. This means if you have kids you are worse off if you get a pay increase that takes you from £99k to £110k. That has caused a measurable reduction in economic output and government receipts.

Tax and incentives is really tricky to make changes quickly - the impact can be high when you make big changes and often doesn't result in what you expect. The world is a big place and there are lots of places to put your money or get a job if you are highly skilled. Of course highly skilled people are what is needed to grow an economy and generate wealth to be redistributed.

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#3510964 13-Jul-2026 12:48

SaltyNZ:

It's the same top tax rate as Australia. So, what happens there?

Australia has a lower overall tax rate then we do.

Mike

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#3510967 13-Jul-2026 12:50

Handle9:

The bigger issue is when you have stacked incentives which cause actual income to drop around certain thresholds. This happens in the UK at £100k where the effective income tax rate between 100k and 125k is 60% as well as losing access to childcare subsidies. This means if you have kids you are worse off if you get a pay increase that takes you from £99k to £110k. That has caused a measurable reduction in economic output and government receipts.

We have that in NZ regarding working for families. With 20/20 hindsight, that money might have been better invested in housing, infrastructure etc.

Mike

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#3510971 13-Jul-2026 13:00

MikeAqua:

Australia has a lower overall tax rate then we do.

But that wasn't what you were discussing. You were specifically discussing the proposed 45% marginal tax rate.

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#3510975 13-Jul-2026 13:03

MikeAqua:

Handle9:

The bigger issue is when you have stacked incentives which cause actual income to drop around certain thresholds. This happens in the UK at £100k where the effective income tax rate between 100k and 125k is 60% as well as losing access to childcare subsidies. This means if you have kids you are worse off if you get a pay increase that takes you from £99k to £110k. That has caused a measurable reduction in economic output and government receipts.

We have that in NZ regarding working for families. With 20/20 hindsight, that money might have been better invested in housing, infrastructure etc.

Not really. Abatement makes the effective tax rate high through the abatement range but you never actually lose money as your income goes up. That’s not the case in the UK.

WFF and the accomodation supplement is an effective wealth transfer from tax payers to landlords but that is a somewhat different issue.

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#3510980 13-Jul-2026 13:26

SaltyNZ:

MikeAqua:

Australia has a lower overall tax rate then we do.

But that wasn't what you were discussing. You were specifically discussing the proposed 45% marginal tax rate.

That's true but they are different systems, so I'd be cautious of comparisons.

Mike

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#3510981 13-Jul-2026 13:29

Handle9:

WFF and the accomodation supplement is an effective wealth transfer from tax payers to landlords but that is a somewhat different issue.

That's a general risk with govt subsidies. It can increase prices. For example, when we had subsidies on insulation, the price of pink batts etc skyrocketed. I wonder what subsidies on solar panels will do.

Mike

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#3510982 13-Jul-2026 13:33

MikeAqua:

I wonder what subsidies on solar panels will do.

In Australia it has brought down prices through getting the industry to scale. The insulation subsidies in NZ were pretty similar.

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#3510984 13-Jul-2026 13:34

MikeAqua:

SaltyNZ:

But that wasn't what you were discussing. You were specifically discussing the proposed 45% marginal tax rate.

That's true but they are different systems, so I'd be cautious of comparisons.

Why? They are both progressive tax systems. In the absence of any evidence I'd say they are directly comparable for this purpose.

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