It identifies factors driving up cost of living
ACT New Zealand (ACT) has slammed the government after finding that inflation shot through the roof due to housing taxes, reforms, and other factors.
ACT Associate Finance spokesperson Damien Smith stated that inflation is at 4.9%, which he described as an “inevitable result of printing money as a cushion through COVID-19. Kiwis are now literally paying the price.”
It expects the holidays to be much more challenging for Kiwis this year as the cost of living shoots up, particularly housing costs, housing taxes, petrol costs, and rental prices. It also expects many first-home buyers (FHBs) and property investors to struggle due to regulatory changes this year.
“The Reserve Bank’s money printing has created enormous inequity, with asset prices being inflated for those already wealthy, while prices rise for those trying to get ahead,” Smith said.
“The government needs to stop messing with the economy. New Zealand now needs sensible economic management. The days of easy money printing are over.”
Considering these factors, ACT advises the government to “ditch its avalanche of damaging regulations.”
“Instead, it should be asking how to create the conditions for prosperity,” Smith said. “The government should be trying to make life easier for New Zealanders, but under its watch, the cost of living [saw] a record increase.
“It all adds up, and middle New Zealand is taking a hammering. Families have to budget and manage their costs; why isn’t this government doing the same and reducing taxes?”
ACT further suggests cutting the 30% marginal tax rate to 17.5%, and reversing interest deductibility changes.
“Under our plan, the average earner would get between $1,286 and $2,107 in their pocket a year from tax cuts,” Smith said. “ACT will continue to fight for middle New Zealand, the battlers being squeezed from every direction by this government.”
Read more: Labour and National reject suggestions for joint housing policy - ACT
This year has been challenging for Kiwis as they continue dealing with the COVID-19 pandemic, housing crisis, and new regulations.
One of the changes most recently criticised by ACT was the Resource Management Act, recently passed in Parliament, with reforms by the National and Labour Parties.
The bill aims to boost housing supply in New Zealand by cutting the red tape blocking housing development and building up to three homes of up to three storeys on most sites without needing resource content. However, ACT claimed the bill would not succeed without further infrastructure funding, which National and Labour rejected.
