Newshub Nation: ACT Party leader David Seymour says New Zealand's wealth gap is acceptable

Tax is a hot-button issue this election and the ACT Party's revenue policy is ruffling some feathers with its unconventional approach. 

The party proposes switching Aotearoa to a two-rate income tax system, with those earning up to $70,000 paying 17.5 percent income tax and those earning anything above paying 28 percent income tax.

People on lower incomes would end up paying more tax but this would be offset by a carbon tax refund that redirects Government revenue from the Emissions Trading Scheme (ETS) to New Zealanders instead of being reinvested into climate-focused policies, estimated to give each person roughly $200 over the years 2024-2027.

ACT leader David Seymour was challenged on his party's tax policy on by Newshub Nation's Simon Shepherd. 

Seymour denied those on lower incomes would be paying more tax, claiming "every single earner will be better off".

"As a New Zealander earning money under ACT's alternative budget you will keep more of your own money because we will stop the Government waste," he said. 

"You will pay less tax if you earn an extra dollar and that's what it's really about."

There are concerns the top-ups from the ETS are an improper use of funds meant to be allocated to fighting climate change. 

But Seymour said "those climate change initiatives have been completely ineffective at reducing emissions".

Part of the way ACT would abolish "wasteful environmental expenditure" is by axing the following climate programmes:

  • Climate Emergency Response Fund spending
  • Energy Efficiency and Conservation Authority
  • Climate Change Commission
  • Clean Car Discount
  • Climate Change Chief Executives Board
  • Industrial energy efficiency and fuel switching
  • Forestry Programme

Seymour said if the initiatives the Government were funding were effective, "people would already be doing it to save carbon credits. 

"Every single dollar in that climate emergency response fund has been ineffective at reducing emissions."

If ACT's tax policy were implemented, wealthy New Zealanders would pay vastly less tax.

In 2021, it was found the wealthiest 1 percent of New Zealanders has a net worth 68 times that of the average New Zealander. 

The wealthiest 1 percent of Kiwis has a share of twenty percent of the country's assets, while the poorest 50 percent has just 2 percent. 

This year, a report carried out by the Government found the median effective tax rate of the very wealthiest New Zealanders is only 9.4 percent, compared with 20.2 percent for other middle wealth New Zealanders.

Asked whether New Zealand's wealth gap is acceptable, Seymour responded, "Yeah it is.

"You tell me what the gap should be," he added. "Do you want more wealthy people in New Zealand or less?" 

Seymour argued higher tax rates lead to wealthy Kiwis leaving the country and accused parties on the left of having policies that "chase the wealthy away".

"We will all be poorer as a result," he said.

"What we want to do is to make success part of New Zealand's culture," Seymour said.

Watch the full interview for more. 

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Public Interest Journalism funded through NZ On Air.