Govt set for tax cuts sales job

Prime Minister John Key. Photo / NZ Herald

Government MPs will travel around the country explaining the October 1 tax cuts as the deadline approaches, Prime Minister John Key says.

An increase in GST from 12.5 per cent to 15 per cent comes in at the same time, and Labour and National have been arguing since the May budget about whether people will be better or worse off.

"Some politicians have been trying to convince New Zealanders that the October 1 tax cuts will leave most individuals and families worse off once the increase in GST and other cost of living adjustments are taken into account," Mr Key said at his post-cabinet press conference.

"Today I can tell you that the Minister of Finance has received advice from the Treasury that shows these claims are demonstrably wrong and he will have more to say about that this week."

Mr Key said a family on the average income of $76,000 a year would be about $25 a week better off, even after the GST increase was factored in.

"Over the next fortnight government MPs will be out and about communicating the effects of the tax changes and you will hear more about that from us as October 1 approaches," he said.

- NZPA