KEY POINTS:
PM says April cuts going ahead as part of National's stimulus package
Prime Minister John Key is unwilling to give a categorical assurance that tax cuts promised for 2010 and 2011 will go ahead.
National's tax cut programme is worth $4.4 billion over the next five years.
While Mr Key has committed himself to cuts in April this year, he was less certain when asked about future years, saying it was his "expectation" nothing would change, but these were "dynamic times".
He failed to definitively guarantee the cuts if things changed.
Mr Key was questioned about future years of tax cuts targeted at middle and upper income earners after comments by Air New Zealand chief executive Rob Fyfe in the Herald that he believed there were better ways to stimulate the economy than by "broad-brushed" tax cuts.
Mr Key said the April cuts would go ahead as an important part of the Government's economic stimulus package, adding that most countries had included tax cuts in their responses to the economic recession.
However, despite being asked three times if the 2010 and 2011 cuts were guaranteed, he prevaricated, saying it was "his belief" they would go through.
When asked if the tax cuts might have to be reviewed, he said he did not want to have hypothetical discussions but noted "we live in dynamic times".
"On the best knowledge I have at the moment, [the programme] is not going to change.
"We live in dynamic times but I wouldn't jump to conclusions on that. It is my expectation they will go ahead."
Yesterday, Labour leader Phil Goff said National should consider halting the April 1 cuts this year if it wanted to show it was serious about keeping workers in jobs.
If the Government does move, it will have to change its own legislation, which it pushed through Parliament under urgency as part of its 100-day action plan.
National's three-year programme was expected to add about $30 a week to the pay packets of those earning $50,000 by 2011 on top of Labour's tax cuts in October last year of $16.50.
The changes in April will increase the middle income threshold from $40,000 to $48,000 and deliver an extra $18 a week to the pockets of those on $50,000.
High income earners will also get a bonus - the top tax rate for those earning more than $70,000 will go down from 39 per cent to 38 per cent.
The 2010 changes would see the top rate drop further to 37 per cent and the middle bracket increase to $50,000. In 2011, the rate paid in that middle bracket was to drop from 21 to 20 per cent.
Tax cuts were a major election campaign promise for the National Party which criticised Labour for failing to give tax cuts in its nine years in Government, despite healthy surpluses.
