Tax cuts and spending both possible - Bill English

Tax cuts are on the table if National forms the next government, Prime Minister Bill English has confirmed.

Speaking to The AM Show on Monday, Mr English said it was one of many priorities being considered.

"We'd like to help low- and middle-income households with their cost pressures. Over the last seven or eight years everyone's contributed to us getting to surpluses, but we're yet to see just how much room there is."

Labour has promised not to raise taxes, but will look at changes - including restrictions on negative gearing to dampen speculation on the property market.

"We will finely calibrate what we do once we see what the Government does in its foreshadowed tax changes, which we assume will be in this year's Budget, but who knows?" leader Andrew Little told The Nation on Saturday.

Mr English says with predicted surpluses into the billions, tax cuts are affordable.

"If you're careful with spending where it's going to be effective and on the things that matter, we've found there's a bit of room to do these other things... more spending on infrastructure, more police, spending on health and education."

He wouldn't say what kind of tax cuts could be on offer. Cuts that help low-income earners also benefit high-income earners, while cuts targeted at the higher end of the scale - such as those made in 2010 - do little for those at the bottom.

"Whatever you do, some households will do a bit better than others because they need more," says Mr English.

"I think they like to know that their hard work has got some payoff. It's recognised that a lot of our low- and middle-income families do a great job of raising their children, looking after their household, making their way in the workplace, and we'd like to help them."

Labour went into the last election planning to raise the top tax rate to 36c, but has ditched that policy. The Green Party however, which has sided with Labour to fight the 2017 election campaign, hasn't backed down from its policy of introducing a new top tax rate of 40c on income over $140,000.

Ms Turei told Newshub they're still developing a new tax policy, and isn't ruling out increases.

We are reviewing our tax policy for this election so we will present that information in time."

The two parties haven't had formal discussions yet about whether to align their tax policies.

Newshub.

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