NZ Elections 2026

• The page is probably incomplete, and may be added to from time to time.
• Below, we compared the policies of the major parties, but we have not done a detailed costing of the proposals.
• Seventeen political parties have registered for the 2026 election.
  • All 17 of these registered parties have submitted formal party lists and are actively competing for the party vote.
  • There are 65 electorate candidates standing either as independent candidates or representing unregistered political parties. Within this group, 48 candidates are running strictly as pure independents.
  • We do not have information on the policies of all registered parties, but have attempted to cover those parties that have previously had members elected to parliament, or have promoted Basic Income.
• This page looks at the election and the policies of the main political parties from a human rights and Basic Income perspective.
  • We compare the Basic Income, tax changes, changes to universal basic services, the universality of payments, and the equitable distribution of wealth policies of the various parties, with particular emphasis on Basic Income payments, universal services, and equitable taxation changes.
• We do not consider all aspects of any party’s policies.
  • People intending to vote in the election are asked to undertake their own investigations, consider all aspects and policies and make their own decisions based on their knowledge and understanding.
  • People are asked to consider the possibility that a small tax cut for themselves could make them better off in the short term, but that a loss of government services might make them worse off overall, or that they or others might find themselves in poverty as a result of the tax cuts.
• Basic Income and Universal Basic Services, such as free public education, free medical care, and other universal services provided by the government, are regarded as complementary, not mutually exclusive.
  • Boosting universal services, such as providing free or subsidised dental care for adults, may give both individuals and families more financial relief than changes to taxation, and provide better targeting of government resources to those in need, boosting the overall well-being of the nation.
  • Similarly, a Basic Income paid to all provides better targeting of government resources to those who need them the most, and better targeting than tax cuts that invariably provide larger tax cuts for the wealthy than for those on low incomes.
• Tax cuts provide short-term relief to some individuals, but tax cuts that are not carefully targeted toward those who need them the most give a short-term benefit, as prices will quickly rise to eliminate any gains.
  • Broad tax cuts always provide more benefit to those on higher incomes, lead to reduced government income and are more often than not followed by cuts in government expenditure.
  • Cuts in government expenditure lead directly to reduced taxation revenue for governments and calls for further expenditure cuts. This can result in a downward spiral.
• Cuts to government and universal services result in people being worse off.
  • Cuts in government expenditure are invariably followed by general economic downturns, which negatively impact the well-being of most citizens.
  • When people have less money to spend, businesses suffer, and there is less money available to pay those on higher incomes.
  • A Basic Income provides a better solution as it broadly targets benefits to those on lower incomes who need them the most and ensures that everyone has at least a minimum amount of money to spend to keep the economy moving.
  • Increasing money in the hands of those with low overall incomes leads to more expenditure and economic growth. People who need money to live tend to spend it repidly on necessities. This increases the rate at which money moves (the velocity of money), which boost overall well being, boosts the economy, increases government tax revenue, and leads to what is knwon as a multiplier effect as the economy expands.
  • Conversly, more money in the hands of those who have high incomes and wealth tends to more slowly, if at all, may simply accumulate in bank accounts or may be spent oversease. GST and other governent revenues fall as a result and the overall economy tends to contract.

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The primary purpose of government is to ensure and enhance the well-being of all a nation’s people, not some at the expense of others. To achieve this, governments will act to ensure:

• law and order, justice, and protection against harm
• protection against invasion by malevolent forces from outside the country
• good quality education and health,
• an adequate albeit basic standard of living for all citizens and
• an equitable distribution of wealth.

Many of the requirements for a government to achieve these objectives are outlined on our United Nations page.

To maximise well-being, governments should ensure efficient management of government resources. This includes the management of the distribution of funds.

Further discussion on the purpose of government is provided on our New Zealand Elections page.

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New Zealand has a unicameral parliament with a mixed-member proportional (MMP) voting system and a three year parliamentary period.

While there are two larger parties, Labour, centre-left, and National, centre-right, most elections under the MMP system require a coalition between a larger party and one or more smaller parties to form a government. This can lead to minor parties having a disproportionate influence in government.

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Past attempts to reform New Zealand’s economy have led to a growing disparity between rich and poor. Gross domestic product grew by 35% between 1982 and 2011.

However, almost half of the increase went to a small group who were already the wealthiest in the country. The average income of the top 10% of earners (those earning more than $72,000) went from $56,300 to $100,200, almost doubling, while the average income of the poorest tenth went from $9,700 to $11,000, an increase of just 13%!

The top 1% of the population now own some 16% of the country’s wealth and the richest 5% owns 38%.

In contrast, 50% of the population, including beneficiaries and pensioners, earn less than $24,000.

Those on the lowest incomes struggle to make sufficient income to pay for food and accommodation. Households often have two adults working long hours just to ensure that they can meet basic requirements.

From this, we can see that there is a need for the government to enhance the well-being of those on the lowest incomes and that there really is no need for any government to enhance the incomes of the wealthiest sectors of the population.

While there are many in the top 50% of the population who feel that life is financially difficult, the major reason for this is the shortage of housing, a result of a long-standing failure to increase the housing supply to match population increase. This shortage has led to increased house prices and rental rates. Increasing the housing supply is the best way to ease both house and rental prices. Simply providing more money to people with incomes in the middle range without increasing the housing supply will lead to corresponding increases in both house prices and rental charges, leaving people no better off.

• Income and Earnings:
  • According to Stats NZ labour market and income statistics, the median wage and salary earner makes approximately $61,958 per year, and earning over $100,000 is no longer rare, with roughly 21.8% of earners exceeding that threshold. Median gross household income has risen past $109,000.
  • However, low-income households and beneficiaries continue to face intense pressure from the cost of living, with median weekly income from government transfers sitting around $486.
• Wealth and Tax Disparity:
  • Recent economic and tax research (such as the Income, Wealth, and Tax at the Top reports referenced in 2026 political debates by parties like the Greens) highlights that the top 10% of New Zealanders hold nearly half to upwards of 68% of net private wealth, while the bottom half hold a small fraction (roughly 3.5% or less).
  • Research shows that high-wealth individuals derive significant portions of their gains through untaxed capital growth (such as property and equities), meaning effective tax rates for the super-wealthy can be lower than those paid by middle-income wage earners. This has driven fierce debate leading into the 2026 election around whether to introduce a wealth tax or capital gains tax versus growing the economy (“growing the pie”).
• The Cost of Living and Housing Squeeze:
  • While headline inflation has moderated down from peaks above 7% under the previous government to around 3% under the current National-led government (driving some relief in mortgage interest rates), housing affordability and rental costs remain central pain points.
  • Auckland’s average house price has fluctuated or dipped slightly under $1 million at times, yet the structural gap between mortgage-free homeowners (averaging over $1.8 million in net worth) and long-term renters (averaging a fraction of that) continues to widen.
  • Debates persist over whether housing affordability is best solved purely through aggressive supply-side deregulation and consenting reform or through targeted demand-side support and tax settings for property investors.

You can track official voting logistics, deadlines, and candidate information via the Electoral Commission Vote NZ Hub.

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Looking at the policies of the various parties, we looked for:

• Any proposed Basic Income policy or alternatives
• Appropriate taxation to accompany a Basic Income
• Goods and Service Tax proposals
• Wealth tax or capital gains proposals
• Universal Basic Services
• Free dental care
• Free or subsidised medical prescriptions
• Proposed changes to New Zealand Superannuation

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Universal Basic Services and Basic Income are complementary. Practical extensions to Universal Basic Services that will enhance the well-being of all people are welcome. Only significant extensions that are part of various parties’ policies are discussed.

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Free dental care is a worthwhile extension of universal basic services and will play a part in improving the general well-being of New Zealanders.

• This is an area where New Zealand is lagging well behind the UK where free dental care was introduced in 1948.
• Australia is ahead of New Zealand with some free or subsidised dental care depending on the state or territory.
• In New Zealand, free dental treatment is limited to those under 18 and is otherwise extremely restricted and usually only available in emergencies.

New Zealand is known for poor oral health. Low flouride levels in natural water sources has resulted in poor oral health in some areas.

Cost is often given as the main reason for not seeking dental care.

• There are reports of people extracting their own decayed or damaged teeth because they cannot afford a dentist.

Two major political parties are campaigning for free, universal dental care for the 2026 election: the Green Party and Te Pāti Māori.

The advocacy group Dental for All released an election resource highlighting that adult oral health has largely been excluded by the major centrist parties, leaving smaller left-wing parties to champion universal coverage.

Specific party positions for the 2026 election include:

The Green Party

For 2026, the Greens have maintained their flagship policy to work towards fully free, publicly delivered dental care for everyone.

• The Plan: Establish a community-based New Zealand Dental Service offering free annual check-ups, cleanings, fillings, and extractions.
• Delivery: They plan to fund mobile dental vans, portable clinics, and community dental hubs (including on marae) to improve rural access.
• Funding: The policy would be funded by their proposed wealth and high-income taxes.

Te Pāti Māori

Te Pāti Māori has also officially adopted a policy of free dental care and free primary healthcare for all whānau for 2026.

• The Plan: They aim to deliver free oral healthcare by shifting health spending toward prevention and investing heavily in marae-based clinics and mobile health units.
• Structure: This forms part of their broader policy to transfer 25% of total health funding directly to Māori-led health systems and rebuild a Māori-led health authority.

Other parties:

• Labour Party: Despite campaigning on free dental care for under-30s in the previous 2023 election, Labour has not included dental care in its 2026 platform. Instead, their health policy focuses on their “Medicard” scheme, which promises three free doctor’s appointments per year, free prescriptions, and free cervical screenings funded by a new capital gains tax.
• National, ACT, and NZ First: None of the current governing coalition parties have released any 2026 policies regarding adult dental care, opting instead to focus healthcare spending on general practitioner retention, frontline capacity, and reducing surgery waitlists.

Free dental care – 2023 election

For the 2023 election, Green proposed free dental care for everyone.

Labour and TOP proposed free dental care for those under 30.

Te Pāti Māori proposed free Dental Care for Whānau earning less than $60,000.

Labour outlined a timetable for the first stages of the introduction of free dental care citing the need to increase the number of dentists as a reason for not immediately extending free dental care to all.

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Political parties often provided online calculators to enable you to see how your tax or after-tax income will vary if the tax plans of the party are adopted. These are generally accurate, although some are a little more accurate than others.

Three parties are proposing changes to income taxes: Te Pāti Māori, Opportunity, and the Green Party.

Te Pāti Māori: Tax Calculator

Opportunity: Tax Calculator

Green Party: Tax Calculator

Other Parties

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Care needs to be taken when considering tax changes. Parties proposing income tax reductions may be intending to increase taxes elsewhere or to cut universal services.

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Parties proposing revised income tax schemes this year include:

Parties not proposing revised income tax schemes

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This overview of New Zealand’s economic landscape, wealth disparity, and housing context ahead of the 7 November 2026 General Election reflects recent data from Stats NZ, the Tax Working Group / independent tax reports, and the 2026 electoral campaigns:

In New Zealand, the debate around a Basic Income (BI) or Universal Basic Income (UBI) features explicit proposals for a full Basic Income alongside existing or historical “partial” basic income systems like New Zealand Superannuation (NZ Super) and the former Universal Child Benefit.

The primary political parties that currently support or have historically backed a basic income model include:

1. The Opportunity Party (TOP)

• Status: Current Champion (Core Policy)
• Approach: TOP is the most prominent advocate for a Basic Income in modern New Zealand politics, putting it at the centre of their platform for the 2026 General Election.
• The Policy: Led by Qiulae Wong, TOP is campaigning on a “Citizen’s Income”.
  • This proposal would give $19,400 per year ($370 per week) unconditionally to almost every New Zealand citizen and resident aged 18 and over.
  • It is designed to replace major means-tested welfare brackets (like Jobseeker Support) and would be funded primarily through a 1.75% national Land Value Tax (LVT).
  • The payments will be tax-free or net payments. This means that those with multimillion dollar incomes will receive exactly the same net amount as those with no other income.

2. The Green Party of Aotearoa New Zealand

• Status: Strong Structural Alignment / Historical Support
• Approach: The Green Party has long held a philosophical policy in its foundational documents supporting a Universal Basic Income.
  • In recent election cycles, they have adapted this into targeted universal mechanisms and a guaranteed minimum floor.
• The Policy: Rather than a strict pure UBI for everyone, the Greens’ current platform relies on an “Income Guarantee.”
  • This ensures that no individual’s income falls below $385 per week.
  • However, they heavily embrace universal elements for children.
  • For example, their platform has frequently included a universal top-up payment for all children under the age of three (regardless of parental income), shifting back toward the universal child benefit model.

3. Current Examples & Historical Party Consensus

While the two major parties (National and Labour) currently oppose an all-inclusive UBI on the grounds of cost and ideology, both have historically engineered and supported New Zealand’s existing “partial” basic income models:

New Zealand Superannuation (NZ Super): New Zealand already operates one of the world’s most successful examples of a (partial) BI. Introduced in its modern, non-means-tested form under the National government of Robert Muldoon in the 1970s, NZ Super is paid to every citizen and resident over the age of 65, regardless of how much asset wealth or alternative income they possess.

It is universal, individual, and unconditional—the exact definition of a basic income, just capped by age. Both National and Labour firmly support maintaining its universal structure.

The Universal Child Benefit: Historically, New Zealand led the world by introducing a universal Family Benefit in 1946 under the First Labour Government. It paid a regular weekly cash sum to mothers for every child under 16, entirely free of means-testing or work requirements.

This classic example of a basic income for children enjoyed broad cross-party support for decades until it was abolished under the Fourth National Government in 1991 during the “Mother of All Budgets” welfare reforms.

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Opinions vary.

Tax-free:. A tax-free Basic Income scheme is the simplest possible Basic Income scheme. It is a net amount paid to everyone at the same net or after-tax value regardless of other income.

• Administration costs are negligible.

However, paying a Basic Income as a tax-free payment is not targeted toward either high- or low-income earners, and the total cost of the payments will be higher than for a taxable scheme.

• Because the total cost of the payments is higher, more tax must be raised to fund the scheme.
• A tax-free scheme is open to the criticism that it unduly rewards billionaires.

Taxable: With a taxable Basic Income scheme, a gross payment is paid equally to all people and is added to other income so that the tax due may be calculated on total income.

• In practice, the government deducts the tax and only pays out the net amount.
• Administration costs are small for most people but higher than for a tax-free scheme.
• With a progressive tax scheme, the Basic Income is additional income for high income earners. With a progressive tax, the Basic Income payments will be taxed at their marginal tax rate (the rate their last dollar earned is taxed at). Consequently, high-income earners will receive lower net payments from a Basic Income than people with low incomes.
• Because the net or after-tax payments received by high-income earners are less than those received by low-income earners, a taxable Basic Income paid with a progressive tax achieves a degree of targeting toward low-income earners, and the total net cost of the payments is lower than for a tax-free scheme.
• As the total net cost of payments is lower with a taxable Basic Income scheme, less tax needs to be raised to fund the scheme.
• New Zealand Superannuation is an example of a taxable Basic Income scheme.

Note: with a flat tax, no targeting is achieved with a taxable scheme and the cost to fund a taxable scheme will be the same as for a tax-free scheme.

Choosing between a tax-free and a taxable scheme is a choice between a tax-free scheme with no targeting, higher total payments and the lowest possible administration costs and a taxable scheme with improved targeting, lower total payments, and slightly higher administration costs.

Traditionally, New Zealand taxes all income, and all government payments intended to provide income are taxable.

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Basic Income advocates usually recomend spreading tax increase over a number of taxes to avoid large increases in a particular tax area and the impacts that this may have.

However, Basic Income proposals are sometimes coupled to one particular funding method.

• An increase in just one tax or the introduction of a new tax to fully fund a Basic Income may result in a large tax and this may have unintended consequences.
• Those who promote a single tax to fund a Basic Income are often more focused on that tax than they are on providing a Basic income.

Basic Income advocates tend to recomend smaller tax increases spread over a number of different taxes. They consder that implementing a Basic Income is more important than the tax that is chosen to fund it.

Remember that money spent as a Basic Income circulates in the economy and creates new economic activity (the multiplier effect). As it circulates, existing taxes, such as GST (VAT), profit taxes, and income taxes will progressively return that money to the government.

Addittional money received by low income people will circulate faster as they usuall spend money they receive quickly on necessities. They have a higher marginal propensity to consume (MPC). They spend the money they receive because they need to do so to live.

Addittional money received by high income people circulates slower as they have a lower marginal propensity to consume (MPC). They do not need the money and do not need to spend it to live.

• “Leakage” occurs when money received by those who do not need it immediatly is banked and ceases moving, or is spent oversease.
• Money banked or spent oversease tends to slow the circulation of money rather than stop it. Money that is not spent immediatly is not taxed until it is spent. This lowers annual government tax revenue.

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Increasing the well-being of a nation, or the total wealth of the nation, or the average net wealth per capita is not necessarily a problem.

• There are many people who have insufficient wealth now.
• There are people who have trouble affording food, and people who are forced to rent because they cannot afford to buy a home.
• However, increasing the wealth of the wealthiest while the least wealthy continue to struggle to feed and house themselves results in a growing inequitable distribution of wealth, and is likely to be counterproductive as it slows the rate of total growth or wellbeing of a nation.

In New Zealand, the increasing accumulation of wealth by a wealthy minority is a significant problem that can lead to a shrinking economy when measured on a per-capita basis, increased inequality, and growing rates of poverty.

Wealth Tax

A wealth tax, rather than a capital gains tax, is a solution to the accrual of wealth by a small minority. A wealth tax can be used to fund or partially fund a Basic Income.

• Care is needed, however, with any form of wealth tax to ensure that it does not discourage people from saving to buy a home, for their future needs, and for retirement.
• A wealth tax should be used for the development and overall good and well-being of the nation.
• With some forms of wealth tax, capital flight and tax avoidance may be a problem. For this reason, some political parties advocate a wealth tax but provide a tax-free exemption to allow people to accumulate a reasonable amount of money during their lifetimes.
• While a family home, holiday home, or family farm might be included in an exemption, the exemption of numerous rental properties or multiple investment farms is questionable.

Adverse impacts of land taxes.

Because of the problem of capital flight, some people suggest restricting a wealth tax to a land tax, as land cannot be moved out of the country to avoid tax. Some suggest that tax-free exemptions be made to avoid taxing family homes and owner-farmers.

It is argued that restricting wealth taxes to land will discourage land speculation and consequently will encourage commercial investment, which will benefit the nation and add to general well-being.

However, taxing land to counter land speculation is like tackling the problem after the event while ignoring the primary cause of land speculation. More than 90% of money in New Zealand is created by commercial banks to enable people to purchase housing, land with a house on it.

Taxing urban land at higher rates than rural land may result in capital flight from the cities to rural areas,increase demand for rural land, which may result in similar problems to those that have occurred with land speculation in the cities.

Increased demand for small rural blocks of land used for vanity purposes and for investment farms may result in increased rural land prices and increased demand for farms to be broken into minimum size holdings. This may result in unproductive use of rural land and many small blocks of idle rural vanity land may result.

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Two main political parties are explicitly proposing wealth taxes for the 7 November 2026 New Zealand General Election: The Green Party of Aotearoa New Zealand and Te Pāti Māori.

The specific wealth tax structures and related wealth-focused taxes being proposed by each party include:

1. The Green Party of Aotearoa New Zealand

The Greens are campaigning on a platform designed to target the assets of the “super-rich” to fund public services and income tax cuts for middle-to-low earners. Their specific wealth proposals are:

• The Net Asset Wealth Tax: A 2.5% annual tax on net individual assets worth more than $10 million (or $20 million combined for a couple). The family home is exempt from this asset calculation.
• Capital Acquisitions Tax: A 33% tax on large inheritances and gifts received that are worth over $1 million. Family homes and family farms are excluded from this tax.

2. Te Pāti Māori

Te Pāti Māori has introduced its “Kiwi Tax Plan”, which includes a multi-tiered wealth tax alongside new property and land-banking charges:

• The Multi-Tiered Wealth Tax: A progressive annual tax targeting individuals with total net wealth exceeding $2 million. The rates scale as follows:
  • 1.5% on net wealth between $2 million and $5 million.
  • 2.0% on net wealth between $5 million and $10 million.
  • 2.5% on net wealth exceeding $10 million.
• Land Banking Tax: A 33% tax on the value of land banks to discourage developers from holding onto empty land rather than building.
• Vacant Homes Tax: A 2% tax on properties left vacant, designed to push empty housing stock back into the rental or buyer market.
• Residential Property Stamp Duty: A 5% tax on residential property sales, which explicitly excludes first-home buyers purchasing properties under $1 million.

(Note: While the Labour Party is also proposing a major new tax for the 2026 election, their proposal is structured as a 28% Capital Gains Tax on commercial and residential investment properties rather than an annual tax on total accumulated net wealth. The Opportunity Party (TOP) is proposing a 1.75% Land Value Tax (LVT), while National, ACT, and NZ First are campaigning on a platform of no new wealth or capital taxes.

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Using a Land Value Tax (LVT) to fund a Basic Income (BI or UBI) or “Citizen’s Income” is the core economic strategy proposed by parties like The Opportunity Party (TOP) for the 2026 election.

This policy combination attempts to solve a dual problem: the high cost of a universal welfare system and the distortionary nature of traditional taxes. Below are the primary advantages and disadvantages of this approach in the New Zealand context.

Advantages

• Economic Efficiency and Non-Distortionary: Unlike income tax or GST, a LVT does not penalise productivity, work, or investment. Because the supply of land is fixed, taxing it does not reduce the amount of land available. Economists often favour LVT because it cannot be dodged or disincentivised.
• Tackling the Wealth Gap and Unearned Increments: In New Zealand, a vast amount of wealth is tied up in untaxed capital gains from land inflation. An LVT captures the “unearned increment”—the increase in land value that comes from community growth, infrastructure (like new train lines), and public investment—and redistributes it directly back to all citizens via the BI.
• Encouraging Efficient Land Use: An LVT taxes the underlying value of the land, not the buildings on top of it. This discourages “land banking” (holding empty urban sections just for capital gains) and incentivises owners to build high-density housing or commercial developments to cover the tax, directly boosting housing supply.
• Highly Progressive Redistribution: High-value land is disproportionately owned by the wealthiest individuals and corporations. Funding a Basic Income with an LVT creates a wealth transfer mechanism where the super-wealthy pay significantly more than they receive, while low-to-middle income earners receive a net financial boost.
• Impossible to Evade: Land cannot be moved to an offshore tax haven. This makes a LVT one of the easiest taxes to enforce, bypassing the complex accounting loopholes often used to avoid wealth or income taxes.

Disadvantages

• The “Asset-Rich, Cash-Poor” Problem: A major drawback is the impact on individuals who own high-value land but have low incomes, such as retirees or long-term family farmers. An elderly homeowner living on NZ Super might face a massive annual LVT bill on a family home that has skyrocketed in value, forcing them to sell or defer the tax against their equity.
• Upward Pressure on Rents: While landlords cannot easily pass an LVT on to tenants in a perfectly competitive market (because land supply is fixed), in a squeezed rental market like New Zealand’s, landlords may try to pass the cost on through higher rent. However, proponents argue a Basic Income payout would help tenants absorb or offset this cost.
• Implementation and Valuation Complexity: Establishing a fair, accurate, and regularly updated system to value only the unimproved land—separate from the house, commercial building, or agricultural improvements on top of it—is administratively difficult and open to frequent legal challenges from landowners.
• Negative Impact on the Construction and Farming Sectors: High land taxes can place a heavy operational burden on sector-specific industries that naturally require vast amounts of land to operate, such as agriculture, forestry, and large-scale commercial development. This could reduce profitability in key productive export sectors.
• Political Volatility and Unpopularity: In New Zealand, homeownership is culturally tied to financial security. Introducing a tax that feels like “renting your own land from the government” faces intense political resistance from a powerful voting bloc of suburban homeowners, making it highly volatile to sustain across election cycles.

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Funding a Universal Basic Income (UBI) by increasing the rate of Goods and Services Tax (GST) is a mechanism occasionally debated by Basic Income advocates and economists.

Because New Zealand has one of the most efficient, comprehensive, and loophole-free GST systems in the world, changing its rate has a massive and immediate impact on government revenue.

Below are the key advantages and disadvantages of this funding model in the New Zealand context.

Advantages

• Massive and Predictable Revenue Generation: New Zealand’s GST applies broadly to almost all goods and services with virtually no exemptions (unlike other countries that exempt fresh food or clothing). Because the tax base is so wide, even a small increase in the GST rate generates billions of dollars in highly stable, predictable revenue to fund Basic Income payments.
• Economic Efficiency and Incentivising Savings: Income taxes can sometimes discourage extra work or corporate investment. In contrast, GST is a tax on consumption. Funding a UBI through GST shifts the tax burden away from earning and onto spending, which can encourage people to save and invest their money rather than spend it immediately.
• Capturing the Shadow Economy and Tourism: Traditional income taxes can be evaded through cash-in-hand jobs, creative accounting, or offshore tax structures. GST is very difficult to evade. Furthermore, international tourists and temporary visitors to New Zealand pay GST on everything they buy, meaning foreign consumers would actively help fund a Basic Income for New Zealand citizens.
• Simplicity and Low Administrative Cost: New Zealand already has the infrastructure to collect GST. Raising the rate requires no new government departments, complex valuation systems (unlike land or wealth taxes), or intrusive auditing. The administrative cost of collection addittional revenue is practically zero.

Disadvantages

• Regressive Impact on Low-Income Earners: GST is inherently regressive because low-income households spend 100% (or more) of their income on immediate everyday survival (food, power, transport). High-income earners save a large portion of their wealth. Therefore, a higher GST rate hits the poorest New Zealanders the hardest as a percentage of their total income.
• The “Churn” and Inflation Risk: A significant hike in GST (e.g., from 15% to 20% or 25%) causes an immediate, one-off spike in the cost of living. While a Basic Income is intended to offset this, the immediate inflation could erode the purchasing power of the Basic Income. The government would essentially be taking money out of a citizen’s left pocket via GST just to return it to their right pocket via the Basic Income.
• Negative Impact on Retail and Domestic Businesses: Higher prices at the counter can suppress consumer spending. A high GST rate can discourage local economic activity, particularly hurting small businesses, retail, and hospitality sectors as consumers cut back on non-essential spending to cope with higher costs.
• Perverse Incentives for Black Markets: While New Zealand currently has very low rates of tax evasion, increasing the GST rate excessively high creates a strong financial incentive for a black market to emerge. It can drive informal “cash-only” economies for trade, construction, and services to bypass the high tax burden at the point of sale.
• High prices may discourage tourism: A significant increase in GST would make New Zealand more expensive for international visitors. Tourism is one of the few export sectors that directly generates GST revenue for the government. International tourists do not receive tax refunds on their spending in New Zealand. A sharp rise in GST (e.g., to 20% or 25%) would immediately inflate the on-the-ground cost of holidaying—affecting dining out, accommodation, domestic transport, and activities. Many tourists have fixed budgets and are likely to reduce purchases as prices rise.
• High consumer prices may add to outward migration: A GST-funded Basic Income could inadvertently accelerate outward migration to Australia, driven by a widened gap in the cost of living and wage structures. Australia has a 10% GST rate with significant exemptions for basic food, health, and education, while New Zealand has a 15% GST with virtually no exemptions. Increasing New Zealand’s GST rate would widen this gap significantly.

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