New Zealand Raises The Minimum Wage And Raises Taxes On The Richest

New Zealand has raised the minimum wage and raised taxes on the richest, two measures that will take effect this Thursday and are part of President Jacinda Ardern’s efforts to fight inequality and boost the economy after the impact of COVID-19.

The new minimum wage will be raised from NZD 18.90 (USD 13.19 or EUR 11.27) to NZD 20 (USD 13.96 or EUR 11.93) an hour, according to the announcement made by the Prime Minister on Monday. New Zealand. This measure is part of his electoral promises and will benefit 175,000 people.

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Also from Thursday, the maximum tax will increase to 39% on the income of people who earn more than 180,000 NZD (125,654 USD or 107,316 EUR), when before the cap was 33%.

The measure is expected to affect 2% of taxpayers.

According to official estimates, this new tax threshold, which is part of a series of tax measures, will provide about 550 million NZD (384 million USD or 328 million EUR) additional to the treasury coffers for the financial year 2021 and 634 million NZD (443 million USD or 378 million EUR) by 2024.

Ardern said Monday, after the Cabinet meeting, that the series of measures that take effect on April 1 represent “real and long-awaited improvements in the support we provide to our most vulnerable (residents).”

The minimum wage increase, which affects many key workers during the COVID-19 pandemic, has been praised by unions and criticized by businesses who claim they have not yet recovered from the economic damage left by the pandemic, which It motivated several confinements, especially in the city of Auckland.

“Precisely when about 1,000 businesses have closed recently, and when especially many people in the hospitality sector tell us that they can not take any more with the increases because they have problems paying rents,” said the opposition leader, Judith Collins, on Wednesday. to the chain TVNZ.

According to data from the New Zealand Ministry of Social Development, companies in the country have hired more staff since the beginning of the year, although there are still more than 200,000 people who receive unemployment benefits, almost 60,000 more than in mid-March, when the pandemic.

A Treasury Ministry report published last December indicates that the deficit for fiscal year 2020/21, which ends June 30, will be NZD 10.1 billion (USD 7.156 billion or EUR 5.89 billion), which is below as forecast, although net debt will increase to 45.6% of GDP by 2023-24.

New Zealand, which closed its borders to curb the pandemic and ordered one of the strictest lockdowns in the world in March when it only had 50 cases, accumulates with 2,141 confirmed infections and 26 deaths.

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