Who pays tax... and how much?
| Individual taxable income ($) | Number of people | Tax paid | ||
|---|---|---|---|---|
| (000) | % | ($m) | % | |
| Zero | 237 | 7% | 0 | 0% |
| 1 - 10,000 | 440 | 14% | 263 | 1% |
| 10,000 - 20,000 | 851 | 26% | 2,199 | 8% |
| 20,000 - 30,000 | 381 | 12% | 1,746 | 7% |
| 30,000 - 40,000 | 352 | 11% | 2,401 | 9% |
| 40,000 - 50,000 | 318 | 10% | 3,071 | 12% |
| 50,000 - 60,000 | 197 | 6% | 2,549 | 10% |
| 60,000 - 70,000 | 148 | 5% | 2,432 | 9% |
| 70,000 - 80,000 | 100 | 3% | 2,018 | 8% |
| 80,000 - 90,000 | 50 | 2% | 1,212 | 5% |
| 90,000 - 100,000 | 35 | 1% | 977 | 4% |
| 100,000 - 150,000 | 78 | 2% | 2,953 | 11% |
| 150,000+ | 45 | 1% | 4,108 | 16% |
| All | 3,232 | 100% | 25,929 | 100% |
This table includes tax on New Zealand Superannuation and major Social Welfare benefits, but excludes ACC levies and anyone who is under 15. Data are projected for the year ended June 2008.
Statutory tax scale from 1 April 2000
- 19.5c per $1 on income up to $38,000
- 33c per $1 on income between $38,000 and $60,000
- 39c per $1 on income over $60,000
With low-income rebate, effective rates are:
- 15c per $1 on income up to $9,500
- 21c per $1 on income between $9,500 and $38,000
- 33c per $1 on income between $38,000 and $60,000
- 39c per $1 on income over $60,000
The statutory tax scale shows the rates before the application of the low-income rebate. Effective rates are what you actually pay.
KiwiSaver
From 1 July 2007
- One-off $1,000 kickstart when opening a KiwiSaver account
- A minimum of 4% of gross salary for contributions through the workplace
- Member’s contributions matched with a tax credit of up to $20 per week per saver ($1,040 per year)
- Annual $40 per account fee subsidy
- Employer matching contributions will be tax-free up to 4% of the employee’s gross salary
From 1 April 2008
- Employers must match employees’ KiwiSaver contributions up to 1% of their gross salary, increasing each year to 4% from 1 April 2011
- Employer’s contributions reimbursed through a matching tax credit of up to $20 per week per employee ($1,040 per year)
Note: Some of the above extend to complying superannuation funds. Special rules may apply for existing superannuation schemes.
Family assistance for working families ($/week)
| Family annual income | Number of children under 13 | |||
|---|---|---|---|---|
| before tax ($) | One | Two | Three | Four |
| … | … | … | … | … |
| 30,000 | 142 | 199 | 256 | 328 |
| 40,000 | 118 | 175 | 232 | 304 |
| 50,000 | 84 | 141 | 198 | 270 |
| 60,000 | 43 | 100 | 157 | 229 |
| 70,000 | 3 | 60 | 117 | 189 |
| 80,000 | 0 | 25 | 82 | 154 |
| 90,000 | 0 | 0 | 42 | 114 |
| 100,000 | 0 | 0 | 2 | 74 |
| 110,000 | 0 | 0 | 0 | 39 |
| Family Tax Credit cut-off point | 56,000 | 71,000 | 84,500 | 99,500 |
| In-Work Tax Credit cut-off point | 71,000 | 86,000 | 101,000 | 119,000 |
Source: https://interact2.ird.govt.nz/forms/famcalc2008. [Link inactive.] Family assistance is in two parts, Family Tax Credit (FTC) and In-Work Tax Credit (IWTC). This assumes family income type is salary and wage, and the family works the required hours to receive IWTC. For more information please visit: www.workingforfamilies.govt.nz
Average incomes
| Average individual wage earnings: | ($) |
|---|---|
| - full-time earner (works for more than 30 hours per week) | 46,002 |
| Average family gross income: | ($) |
|---|---|
| - couple with children | 92,882 |
| - couple with no children | 74,637 |
| - sole parent | 31,615 |
| - single person | 28,803 |
Includes benefits and other non-wage income for year ended June 2008
What is the full-year cost of . . .?
| ($m) | |
|---|---|
| $1 a week increase (in the hand) to NZ Super | 26 |
| $1 a week increase (in the hand) to other benefits | 15 |
| $1 billion increase in government debt | 58 |
How does a 1% change in growth affect tax?
| Tax source: | ($m) |
|---|---|
| - wages and salaries | 250 |
| - taxable business profits | 125 |
| - spending by households | 115 |
Estimated effect on a full year’s revenue of a one-percentage point change in the growth of the income or spending source in 2007/08.
How does a 1% change in tax rate affect tax?
| ($m) | |
|---|---|
| Top individual rate (current rate = 39%) | 150 |
| Upper middle rate (current rate = 33%) | 130 |
| Lower middle rate (current rate = 21%) | 390 |
| Bottom rate (current rate = 15%) | 220 |
| Company tax rate (current rate = 33%) | 200 |
| GST rate (current rate = 12.5%) | 685 |
Estimated effect on full year’s revenue of a one-percent change in tax rate. This allows for interaction between tax types, but makes no allowance for feedback effects from the economy.