Budget 2024 tax calculator: See how tax cuts affect you and what’s in it for you

• The 2024 Budget introduces a $3.7 billion annual tax package, benefiting workers earning over $14,000.
• About 3.5 million people will receive tax cuts, with families gaining from childcare rebates and tax credits.
• Finance Minister Nicola Willis states the tax cuts are funded by $6b in Government savings.
• Follow our live Budget coverage here.

Workers will get their first tax cuts in 14 years after the Budget 2024 delivers the Government’s promised income tax cuts. These tax cuts will provide savings of up to $40 a fortnight for many workers, although the lowest income earners and superannuitants will only benefit by $9. To understand how these changes impact you, use our tax and Budget calculator below.

Families with children will also benefit from changes to the Working for Families in-work tax credit and new childcare rebates in a Budget which is estimated to benefit about 1.9 million households by $60 a fortnight on average, and households with children by $78 on average. In total, 3.5 million New Zealanders will get a tax cut.

The Budget’s main feature is the $3.7 billion a year tax package, which will kick in from July 31 and cut the taxes of all earning more than $14,000 a year. Working-age New Zealanders will benefit by $38 a fortnight on average.

Use our calculator below to see your tax cut

You may be eligible for other credits and/or rebates - scroll down to find out more.

All the income tax bands have been lifted, other than for income of more than $180,000.

As well as income tax cuts, the Working for Families tax credit will increase, giving about 160,000 low to middle-income families an extra $50 a fortnight.

And the new Family Boost childcare rebates for about 100,000 families on less than $180,000 a year will give up to $150 a fortnight to some families - although that has come at the cost of scrapping the previous Government’s extension of free ECE to 2-year-olds.

The tax package also extends the independent earners’ tax credit (about $20 a week) to those who earn less than $70,000 (up from an income cap of $48,000 a year) – meaning about 420,000 more people will be eligible for the credit for those who do not get other assistance such as Working for Families or superannuation. That credit abates for those on more than $66,000. A total of 725,000 will be eligible for it.

Families’ gain

About 12,000 families are expected to get the maximum amount of $250 a fortnight from the combined package – those are families who will get the full Family Boost rebate.

Finance Minister Nicola Willis defended giving more assistance via tax cuts to working couples than to superannuitants, saying they would also benefit from larger increases to super rates because those were lifted based on the after-tax wage.

She said the tax cuts package would cost about $3.7 billion a year – and was fully funded by cuts the Government had made to other areas of spending. More than half of the $6 billion freed up by that cost-cutting exercise was going into the tax cuts programme.

Speaking in the Budget lock-up, Willis also ruled out more tax cuts in this term, saying despite talking to the Act Party about a flatter tax structure that would not be possible until the economy was back under control and the books were in surplus. That is not expected to be until 2027/2028, when a slim surplus is forecast.

Examples

Average income household ($125,000 a year) with two children in ECE: $252 a fortnight (tax cuts and childcare rebates)

Average income household with two school-aged children: $102 a fortnight (tax cuts)

Working couple earning $150,000 each: $80 a fortnight

Minimum wage earner, earning $48,152 a year: $25 a fortnight

Couple both earning $75,000 a year with a child in ECE: $173 a fortnight

Sole parent on $80,000 with two secondary school-aged children: $90 a fortnight

Single adult on $55,000: $51 a fortnight

Retired couple on NZ Super, no other income: $9 a fortnight (rising to $26 a fortnight in 2026 as super is increased).

*examples provided by Treasury

The income tax cut changes

* 10.5 per cent on income below $15,600 - (currently $0 - $14,000)

* 17.5 per cent on income from $15,601 to $53,500 - (currently $14,000 - $48,000)

* 30 per cent on income from $53,501 to $78,100 - (currently $48,001 to $70,000)

* 33 per cent on income from $78,101 - $180,000 (currently $70,000 to $180,000)

* 39 per cent on income above $180,000 (no change).

The tax cuts package is the same as that set out in National’s campaign policy, which its coalition partners agreed to allow it to implement in return for some concessions.

Willis said the tax package was deliberately designed to benefit low to middle-income families with children.

She said that tax cuts were fully paid for by the Government’s savings drive, which had secured about $6 billion a year. Of that $3.7 billion would be used for tax cuts and the remainder for other measures in the Budget.