National deputy leader Nicola Willis claims Labour's unconfirmed tax policy will cost 'around half a billion dollars a year'

The National Party believes a rumoured tax policy from Labour will cost "around half a billion dollars a year".

National deputy leader and finance spokesperson Nicola Willis claims she's had the incumbent governing party's tax policy leaked to her, with the main aspect being scrapping GST from fruit and vegetables.

Labour leader Chris Hipkins has refused to confirm nor deny the policy.

Willis, however, is adamant it's happening - saying she has it on good authority from a Labour leak.

"I can't reveal my sources because they would be very worried about being revealed and, you never know, there might be more water from this well in future," she told AM. "I understand why people want to know but I'm not going to go into who it is, but what I will say is I'm confident in the information that I've received and people can see that this week, Labour has been leaking like a sieve."

Willis pointed to another leak out of Labour's caucus meeting earlier this week in the aftermath of senior minister Kiri Allan's resignation, who quit after being involved in a car crash in Wellington on Sunday night and is now facing criminal charges. 

Newshub confirmed with a caucus source there was an open and robust discussion about Allan at Tuesday's meeting and one Labour MP spoke up about being yelled at by the now-former Justice Minister.

Labour ministers subsequently fended off questions about disunity within the party.

But it's "pretty clear there's a lot of unhappiness over on that side", Willis said.

Asked how she thought Labour would pay for its unconfirmed tax policy, Willis said that was "always the question".

"Their form is that, typically, they are pretty keen to tax people more so I presume that this GST policy would be funded by bigger taxes elsewhere.

"It's something they're at sixes and sevens at, at the most senior level," Willis said, pointing to now-former Revenue Minister David Parker's resignation from the portfolio earlier this week. 

As of today, however, Willis has not revealed how National will pay for her own policy to index tax thresholds to inflation.

National has previously said its fully-costed plan would be unveiled ahead of the pre-election fiscal update - a month before New Zealanders head to the polls.

However, National leader Christopher Luxon said earlier this week it could now be earlier than that.

Willis confirmed on Friday that was the case.

"We are going to bring that forward and you will know about that really soon," she said.