What a New Government Could Mean for Your Finances

What a New Government Could Mean for Your Finances

New Zealand heads to the polls later this month. With politicians on both sides making major promises, Kiwis should expect significant changes in the months to come - no matter who wins on September 23rd. What could a new government mean for your finances? We’ve taken a look at where New Zealand’s major parties stand on several key personal finance issues.

Housing

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For many New Zealand households, a house is both a home and a key financial investment. Unfortunately, many New Zealanders are locked out of home ownership, and the issue is set to be a decider this election. National, the current governing party, has announced policies that largely involve unlocking more land for housing development. Labour, on the other hand, is focussed on addressing speculation (where people buy houses solely for capital gain) and building large numbers of houses in heated areas. Most parties, including National, Labour, and New Zealand First, are proposing additional support for first home buyers, although it’s possible extra support will only add to house prices.

Tax

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Tax is always a contentious election issue. Few parties can agree on what taxes and tax rates are fair. Labour and National largely favour the current tax system, which mostly involves taxing income. That said, Labour is not ruling out implementing a capital gains tax (which could involve taxing the profit of shares or property). The Greens favour a capital gains tax, with an exemption for the family home, while the Opportunities Party’s tax policy involves a major rethink - they’re calling for a tax on the value of assets, similar to the way that council rates are currently charged.

Superannuation

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Whether we need it or not, all New Zealanders are eligible for NZ Super at age 65. National and ACT propose to raise the eligibility age by two years, while most other parties have pledged to keep the eligibility age at 65.

Education

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Education policy can have a major impact on younger New Zealanders’ financial wellbeing. Labour and the Greens both propose some form of free tertiary education and, along with the Maori Party and New Zealand First, also support extending student allowances. National supports a modest $20 uplift to the student allowance to reflect higher costs of living in areas such as Auckland.

Whatever your financial position and stage of life, it's important to know how a change of government may affect your wallet. That said, running the country is about more than housing and tax. The party with the most attractive policies in the short term is not necessarily the best option for you or New Zealand.

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