Simon Bridges announces teaser in National's economic goals

The National Party is dangling a tax cut carrot in front of those earning the average wage.

But party leader Simon Bridges is yet to say if he plans to change marginal tax rates or the income brackets where they kick in, reserving those details for later in the year.

This morning, the Herald reported that Bridges would today outline the party's economic goals and who will benefit most from the party's proposed tax cuts.

In his speech in Auckland today setting out National's economic agenda, Bridges said National's tax cuts would benefit those on the average wage.

"We will announce our full tax plan that will see people on the average wage better off and keeping more of what they earn," Bridges said.

"People on the average wage shouldn't be paying almost 33 per cent in the dollar."

Afterwards, Bridges told media that the speech wasn't about a "wiz-bang" announcement.

"We think that at $60,000 to $65,000 a year right now, you're doing it tough in New Zealand," he said.

According to Stats NZ, the average income in the December 2019 quarter - based on average weekly earnings including overtime - was about $66,000 a year.

People earning that much currently pay a marginal tax rate of 30 per cent on income over $48,000, and they earn just below the $70,000 threshold where the highest marginal rate of 33 per cent kicks in.

National has previously announced a plan to index tax brackets to inflation, which alone would see more money in the pockets of all workers who earn more than $14,000 - the rate at which the second marginal tax rate of 17.5 per cent applies.

In his speech, Bridges announced the goals for a National-led Government's first term:

• Economic growth at least 3 per cent per annum

• New Zealand's per capita growth rate in the top half of the OECD

• Reducing the after-tax income gap with Australia

• Stopping the number of New Zealanders heading overseas

• Reviving business confidence

Bridges said there were five planks that make up the party's economic plan: tax relief, regulation reduction, infrastructure, small businesses and families.

He said the party, if in Government, would also target costs of living, including reversing new costs on landlords in an effort to lower rents for tenants.

But there would be no requirement for landlords to pass those savings on to tenants.

"In terms of families, tax and costs and red tape mean that more and more feel like they're treading water or going backwards," Bridges told the Herald in an interview before his speech.

"If you're renting, rents have gone up because of added taxes and regulation."

The Government has made a number of changes to rental laws including limiting rent increases to once a year, banning letting fees and introducing Healthy Homes standards for heating, insulation and ventilation in rental properties.

Bridges said he would scrap the Government's ring-fencing of rental losses and ease some of the Healthy Homes standards.

"If you talk to anyone from the city missions, the single biggest growth in hardship has been rent rises.

"I lay the blame at the costs and regulations the Government has piled on landlords, which has either pushed them out of the market or been passed on to the poor renter."

According to CoreLogic senior property economist Kelvin Davidson, the average weekly rent in Tauranga has hit $487, increasing the cost of a rental by more than $2000 a year.

Bridges also told the Herald he wanted to allow foreign buyers back into the housing market - but only for expensive homes rather than for "affordable" housing.

"We do want to see investment, for example, in new builds and at the high end of residential property, because it stimulates the market and encourages people to come here and invest.

"But we don't want foreign investors buying $650,000 houses."

Finance Minister Grant Robertson responded to Bridges' speech by saying: "Is that it?

"The very first question he faced from the audience was about climate change. The fact that Simon Bridges didn't talk about climate change during a major speech on the economy was deafening."