Michael Wood hits out at National after Simon Bridges confirms party would remove top tax bracket

Michael Wood is hitting out at National after Simon Bridges confirmed it would remove the top tax bracket within the first term if elected. 

It comes after leader Christopher Luxon wiggled around the question on Wednesday. 

The National Party is proposing changes to the tax brackets to offer relief as the cost of living skyrockets. Luxon has also committed to removing all taxes introduced by Labour since 2017. When asked by AM on Wednesday whether that included the top tax bracket, Luxon wouldn't give a clear answer. 

But Bridges cleared it up on AM on Friday. When asked whether the highest bracket was gone under National, Bridges said: "Yes it is in the first term."

His comment came after Labour Minister Michael Wood criticised National's tax plans. 

Wood told AM if the top tax rate of 39 percent was removed, he would get a $7000 tax cut while people earning $40,000 would only get an extra $2.15 a week - just over $100 a year. 

"I've just done the sums, for someone like me as a Cabinet Minister, if National goes ahead with that I get a $7000 tax cut." 

MPs usually earn between $160,000 and $180,000 a year, while Ministers earn between $250,000 and $300,000. The Prime Minister's salary is set at $470,000.

But Bridges hit back at this, saying Wood was suggesting someone earning $80,000 a year was rich. 

"What Michael is actually saying is that someone on $80,000 with a family in Auckland is actually rich. That they are doing really well but we actually believe in a cost of living crisis they deserve a grand back, it's not going to make them rich but it will give some meaningful relief."

The proposed tax cuts come amid concern over New Zealand's increasing cost of living. On average Kiwis are spending an extra $4000 and $5000 in the past 12 months on basics such as food, rent and fuel. The majority of the increase is fuel with an extra $678 a year at the pump on average. 

Luxon told AM on Wednesday changing New Zealand's tax brackets would help struggling families. 

Currently Kiwis are taxed 10.5 percent on each dollar earned up to $14,00 a year, 17.5 percent for $14,000 to $48,000 a year, 30 percent for $48,000 to $70,000 a year and 33 percent for $70,000 to $180,000 a year. Labour also introduced a new tax rate in 2020 of 39 percent for income over $180,000 a year. 

Luxon also vowed to repeal every extra tax hike or added levy the Labour Government had imposed since 2017, which would include the highest tax rate. 

The Government has criticised National's plan saying it would lead to cuts to basic services such as health, education and housing services. 

The Government has also refused to call the increasing cost of living a crisis with Prime Minister Jacinda Ardern saying some Kiwis are struggling but she "wouldn't describe it that way". 

The sentiment was echoed by Wood who told AM, that language is less important than action. 

"What I would say is that it's less important the languages that individual politicians might use and it's more important what we actually do about it. 

"What I would absolutely acknowledge is that there are cost of living pressures, real cost of living pressures. We do see those petrol prices, of course, those are driven by international factors. What is important is what we do and that's why our focus is on supporting lower and middle-income earners not big tax cuts for the very wealthiest as National would."