If GST rises in the upcoming budget then superannuation payments would immediately rise by 2 percent in addition to any tax cuts that would apply, Prime Minister John Key said today.The Government is considering lifting GST from 12.5 percent to 15 percent
If GST rises in the upcoming budget then superannuation payments would immediately rise by 2 percent in addition to any tax cuts that would apply, Prime Minister John Key said today.
The Government is considering lifting GST from 12.5 percent to 15 percent and cutting property tax deductions to fund across the board tax cuts.
Mr Key made the announcement at a speech to a Grey Power meeting in Auckland today.
"Superannuitants would get an income tax cut, which would apply both to superannuation payments and to any other income they receive from interest, dividends or part time work," Mr Key said in speech notes.
"In addition to their tax cut, superannuation payments would be increased up front, by just over 2 percent, to reflect the general rise in prices. The increase in super payments would be immediate from the day GST went up without waiting for the usual annual inflation adjustment."
In addition tax cuts would mean a lift in the after-tax average wage, raising the floor for superannuation payments, which are linked to the average wage.
Super payments to married couples can not drop below 66 percent of the after-tax average wage, so this increase would flow through to super.
