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New Zealand|Politics

Budget 2021: Act Party leader David Seymour reveals alternative budget

3 minutes to read
Act Party leader David Seymour calls it a "budget for battlers". Photo / File

Act Party leader David Seymour calls it a "budget for battlers". Photo / File

Michael Neilson
By
Michael Neilson

Michael Neilson is a senior political reporter for the New Zealand Herald

Act Party leader David Seymour has produced an "alternative budget" which he says would nearly halve the tax rate for middle income earners while also slashing forecast debt by $23 billion.

Sneaking in ahead of Budget Day on May 20, Seymour revealed his own radical vision for New Zealand, in a document largely based on Act Party policies.

The focus is on "middle New Zealand", which Seymour says "work[s] hard but are being squeezed from every direction".

The cornerstone policy would see the 33 per cent tax rate - which applies to income over $70,000 - slashed to 17.5 per cent.

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Rents were increasing rapidly, and home ownership was increasingly out of reach, Seymour said.

"Kiwi battlers are paying more at the supermarket and at the pump, and they're getting hit with new taxes while wages fail to keep up."

Act's alternative budget would deliver $11.2b in savings, taking on $23b less debt and deliver $3.8b per year in tax cuts, including reversing the recently-introduced 39 per cent tax rate for income over $180,000 and the interest deductibility change.

The budget document is light on the exact services that would need to be cut to fund the tax cuts and savings while reducing debt.

It would not touch any health nor education spending, Seymour said, rather focus on reining in "personality projects" like ending film subsidies.

"Fundamentally, our tax system just isn't fair," Seymour said.

"Middle New Zealand workers are being taxed as if they're rich, paying the 33 per cent tax rate at just $70,000 a year."

Seymour also took aim at Government debt, which he said was currently at $105b.

"That's $28,995 for every taxpayer," Seymour said.

"If it's not you paying it back, it will be your children and their children.

"Everything this Labour Government does is either about taxing and redistributing, or dividing us against each other.

"There is a better way, as Act is showing today in our budget for the battlers.

Act's alternative budget also includes reversing policies such as the Matariki public holiday, new sick leave entitlements, and 90-day trial changes, and minimum wage increases would be paused for three years

Act would repeal the ban on new offshore oil and gas exploration permits, repeal the Zero Carbon Act and reject the Climate Change Commission's recommendations, along with repealing the Resource Management Act.

Finance Minister Grant Robertson will unveil Budget 2021 on Thursday, May 20.