Maori Party would cut tax across board

The Maori Party is joining the list of parties promoting tax cuts, and wants to end income tax for those on low incomes.

Next week, the party launches a multibillion-dollar tax cut and poverty-reduction plan that could include up to $3 billion to eliminate income tax for those on low incomes.

President Dr Whatarangi Winiata said the party also wanted to cut the 39c top personal rate and the 33c personal and company rates to 30c. That would cost another $1.9 billion.

Dr Winiata floated the suggestion on a tax debate on Channel One on Thursday, saying the Government's finances showed there was room for $4 to $5 billion in tax cuts.

Asked yesterday if he would want to change the Working for Families package, he said he was still working on that issue.

The policy places the party - formed when Labour minister Tariana Turia resigned and was re-elected in a byelection - in the camp of parties such as National and Act.

But Dr Winiata did not agree with the notion that the Maori Party was aligning itself with the right-wing.

"I don't see ourselves that way ... I know you have right-wing people and left-wing people but it's not appropriate to be talking of us as in one camp or the other."

National finance spokesman John Key said he was surprised by the Maori Party's support for tax cuts, but it showed Labour was now in a "club of one".

"Maybe it will finally dawn on them that taxpayers have had enough of being overtaxed."

Asked about whether they could go into coalition with the Maori Party on the basis of this policy, Mr Key said coalitions were something to be decided after the election.

Finance Minister Michael Cullen will wait for details of the policy before commenting.

Dr Winiata said company tax cuts were to make New Zealand more competitive with Australia, but it should be accompanied by an obligation on firms meeting higher environmental standards.

The Government's coalition partner, the Progressives, surprised everyone last November by coming out in support of a cut in the company rate to 30c.