Media Successfully Uses Liz Truss Debacle to get Chris Luxon to Cave on Tax Cuts
November 23, 2022
PHOTO: Tom Lee/Stuff
National Party leader Christopher Luxon says he will reconsider scrapping the top 39% tax rate if it would add further fuel to the inflation fire, after the Reserve Bank hiked interest rates in an attempt to tackle rampant inflation amid soaring costs.
Luxon’s tax-cut proposals, touted as a way to take pressure off families, have faced consistent backlash, after the chaotic fallout in the UK when its government outlined and then U-turned on tax-cuts. Luxon said indexation – adjusting income brackets to take inflation into account – was still on the table, but the rest of the policy would be reviewed.
“We would like to offer people tax relief, but when I look at things … if I think about the 39% tax rate in particular, that’s something that I really want to think about.”
The situation had changed “big time”, he said in the Beehive.
“Let’s get really sobering about the reality of this. Interest rates are going to continue to rise because inflation is stubbornly high, and we are now heading to a recession.”