KEY POINTS:
National is set to unveil its tax cut package next week, party leader John Key says.
Labour's tax cuts, which deliver between $12 and $28 a week to most wage earners, take effect today.
However, National has promised more and Mr Key today said it was likely he would reveal how much people would get next week following the pre-election opening of the government books on Monday.
"It's very likely to be next week that we will do it," Mr Key said on TVNZ's Breakfast programme this morning.
He expected the books would show "quite a lot of red ink", but it would only be marginally worse than what National had been expecting when it finalised its tax package.
National has said it will incorporate Labour's cuts into its programme and will deliver a second round in April next year.
It has indicated that when combined those cuts could be worth around $50 a week for average wage earners, but has not disclosed how it will pay for the supersized cuts.
Under Labour's tax cuts, only those earning over about $80,000 will get over $50 and not until second and third rounds kick in April 2010 and 2011.
National's decision to release the centre-piece of its election campaign next week is slightly unusual as it will come before the party's official campaign launch on October 12.
Prime Minister Helen Clark today said it was due to National's campaign having lost momentum.
"I think they've lost momentum from the time of the announcement of the election campaign, but the issue that's now starting to be raised is whether there has been weasel words about the size of what they are doing."
She said if National failed to deliver on its promise of $50 a week tax cut it would be punished by voters.
But if National was true to its word it raised questions about their ability to manage the economy.
"I think what is surprising is that they say that nothing that is happening in the worst financial crisis since at least the 1930s is going to make a blind bit of difference to what they are doing with that package.
"They never cared about what the pre-election fiscal update said and now they don't care about the world financial crisis either."
Under Labour's first round of cuts those with a taxable income of $20,000 will get $12 a week extra, those on $50,000 will be $16, while those earning above $70,000 will get an extra $28.
The first tax cuts in a decade come as the world economy is thrown into turmoil with the Unites States Government grappling with the credit crisis.
The local economy is also struggling with confirmation last week that New Zealand had been suffering a mild recession through the first half of the year.
Labour is hoping the cuts will stimulate the economy and help it start growing again in early 2009.
Mr Key yesterday said National's larger cuts would inject some welcome confidence into the economy.
- NZPA
