Green Party co-leaders Marama Davidson and James Shaw. Photo / RNZ / Angus Dreaver
The Green Party has announced an election policy for households to meet rising costs, with an "income Guarantee" that will ensure no one gets less than $385 a week in their pocket after tax - to be funded through higher taxes on top earners, trusts and businesses.
The party's co-leader Marama Davidson said for couples, the income guarantee would be at least $770, while a single parent would always have an income of at least $735.
"This will give everyone peace of mind that they can always afford the weekly shop, pay the rent, or cover unexpected costs - even when times are tough," she said.
It would be funded through changes to the tax system including a new top rate of income tax of 45 percent on income over $180,000 and a 2.5 percent wealth tax on assets.
[ Read the full policy document here. ]
However, anyone earning under $125,000 would pay less tax as a result, with a tax-free threshold of $10,000.
Davidson said it was "a transformational new way" of doing income support to lift every family out of poverty.
"The income guarantee is fully funded through fair and simple changes to the tax system that unlock the resources we need. Every dollar will come from those most able to contribute, while those on the lowest incomes will pay less.
"Overall, the Ending Poverty Plan will result in tax cuts of between $16 and $26 a week for 3.7 million New Zealanders.
"The income guarantee means families will always have enough kai, or can buy the shoes and warm clothes that children need. Students will no longer have to skip meals to make ends meet and can focus on their study. And if something happens that stops people from working, there is a guaranteed income that's enough to live on."
The current basic job seeker benefit is $258.50 after tax.
Party co-leader James Shaw said in a wealthy country like New Zealand, there were hundreds of thousands of people who were struggling to put food on the table, or where kids have to take days off school just so they can work to help their families cover the basics.
"What we do to prioritise the lives and livelihoods of those who need our support the most should be the measure of every political party. In fact, I would argue that any party that stops short of promising to lift every family out of poverty, is actively choosing to make life harder for thousands of people.
"I am sick of the politics of excuses. Everything we need to make life better for people in Aotearoa exists. What's missing is the political willpower to use it. The time is now to lift every single family out of poverty and to pay for it with a fair tax system.
"Our fully costed plan will make sure everyone can pay the bills, put food on the table, and keep the house warm," Shaw said.
Labour, National react to Greens' proposal
In a statement, Labour Minister of Finance Grant Robertson said the party will release its own tax policy soon.
"All parties, including Labour, will have their tax policies to take into the election. Labour will release its policy shortly.
"I would note that Budget 2023 included aligning the trustee rate with the top 39 percent personal tax rate to make the tax system fairer."
National has released a tax plan but has said it will announce a fully costed fiscal plan closer to the election in October.
National's finance spokesperson, Nicola Willis, said the Greens' proposed move would gut the country of investment and opportunity, as businesses would flee offshore or shut up shop.
"You can't tax your way to a stronger economy. And it is only through a strong economy that we can lift incomes, solve the cost of living crisis and afford the public services that all Kiwis deserve.
"This massive tax grab by the Greens is exactly what the country doesn't need - but unfortunately it is exactly what Kiwis can expect from a Labour-Greens-Te Pāti Māori coalition of chaos."