WELLINGTON, May 25 (Xinhua) -- New Zealand on Thursday unveiled its Budget 2017, with a new Family Incomes Package to lift after-tax incomes, provide better rewards for hard work, and benefit low-income earners with family burdens.
From April 1, 2018, the bottom two tax rate thresholds will lift up, with the lowest threshold lift from 14,000 NZ dollars (9,829 U.S. dollars) to 22,000 NZ dollars (15,446 U.S. dollars), and the 48,000 NZ dollars (33,700 U.S. dollars) tax threshold increase to 52,000 NZ dollars (36,509 U.S. dollars), according to the new package.
The Family Incomes Package "is carefully designed to especially assist low and middle-income earners with young families and higher housing costs," Finance Minister Steven Joyce said in a release.
"It is important that Kiwi families directly share in the benefits of New Zealand's economic growth," Joyce said, adding that some of the biggest gains in the Package are for people on lower incomes with young children.
The government's 2 billion NZ dollars (1.4 billion U.S. dollars) annual Family Incomes Package will make changes to tax thresholds, and other benefits like Working for Families and the Accommodation Supplement, to help Kiwi families get ahead, he said.
The Budget 2017 Family Incomes Package benefits around 1.3 million families in New Zealand by, on average, 26 NZ dollars (18.25 U.S. dollars) per week, which are expected to lift 20,000 households above the threshold for severe housing stress, and reduce the number of children living in families receiving less than half of the median income by around 50,000, Joyce said.
The new package also increases the Family Tax Credit rates for young children to the level of those for children aged 16 to 18, while increasing the abatement rate and decreasing the abatement threshold.
Joyce said that as wages have risen over the last seven years, people on lower and middle incomes have been faced with higher marginal tax rates.
"The Budget 2017 Family Incomes Package will provide better rewards for hard work by adjusting the bottom two tax thresholds, and lowering the marginal tax rates for low and middle-income earners," Joyce said.
The tax threshold change provides a tax reduction of 10.77 NZ dollars (7.56 U.S. dollars) a week to anyone earning more than 22,000 NZ dollars (15,446 U.S. dollars) per annum, increasing to 20.38 NZ dollars (14.31 U.S. dollars) a week for anyone earning more than 52,000 NZ dollars (36,509 U.S. dollars) per annum, he said.
"The Family Incomes Package will also help lower income families with young children meet their living costs through changes to the Family Tax Credit, and it will improve the incomes for those with higher housing costs," Joyce said.
