National’s ‘no new taxes’ promise comes with fine print

Summarised by Centrist

National is promoting a “no new taxes” message, but finance spokesperson Nicola Willis has stopped short of ruling them out altogether, limiting her guarantee to workers, small businesses and pensioners.

Luxon has since said fuel excise will eventually need to rise to fund roads, and National is considering an Auckland accommodation levy and has examined bank-tax options. He stressed that no decisions had been made and the party’s full tax policy would be released during the campaign. 

“Listen to me very carefully. No new taxes on working people. No tax increases for working people,” Willis told reporters.

She also ruled out increases for small businesses and pensioners, adding that workers should expect no new taxes on “their savings, their investments or their capital”.

The careful wording drew criticism from Taxpayers’ Union executive director Jordan Williams.

“The public knows a fudge when it sees one,” Williams said. “When a politician says ‘no new taxes’ and then adds ‘on working people’, voters hear the qualification louder than the promise.

Luxon later pointed to fuel excise, an Auckland accommodation levy and possible bank-tax changes as areas National could consider, although he said no decisions had been made. 

He also ruled out a capital gains tax and wealth tax, calling them damaging to the economy. National’s full tax package is still to come. 

National also promised to return the books to surplus in 2028/29, reduce debt below 40% of GDP and lower government spending towards 30% of GDP over time.

Infometrics economist Brad Olsen called the debt target “probably the least ambitious” possible, saying National would need to curb spending but had not identified what it would cut.

Labour, meanwhile, is promising to direct more government work towards small businesses.

The party would set a target for small operators to receive 15% of government contracts, break up large contracts where practical and remove barriers preventing smaller firms from bidding.

“Government is the biggest customer in the country, buying around $50 billion of goods and services annually,” Labour finance and economy spokesperson Barbara Edmonds said.

The target could therefore cover contracts worth up to $7.5 billion annually. However, Labour has not disclosed the current share going to small businesses, how progress would be measured or whether agencies would be required to comply.

Revenue spokesperson Deborah Russell said Labour would also “look at” reducing paperwork and reviewing tax administration so businesses would not have to provide the same information repeatedly.

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