4. Tax System—RatesHon STEVEN JOYCE (National) to the Minister of FinanceTax System—Rates4. Hon STEVEN JOYCE (National) to the Minister of Finance: What was the marginal personal income tax rate paid by someone on the full-time median wage on 1 April 2011 and how does this compare to the expected marginal rate paid by someone on the full-time median wage on 1 April 2018 under his tax package?Hon GRANT ROBERTSON (Minister of Finance): On 1 April 2011 someone on the full-time median wage paid a marginal personal income tax rate of 17.5 percent—that's if we use annual figures. I've been advised by Treasury and IRD that they do not make forward projections of the full-time median wage so I am unable to fully answer the second part of the member's question. However I can tell the member that the Government is not proposing to alter the marginal tax rates on what people are currently earning.Hon Steven Joyce: I raise a point of order Mr Speaker. Given that the median wage is currently around $50000 a year it surely would not be beyond the wit of the finance Minister to make an estimate as to what the tax rate would be on 1 April 2018 under his tax package because I can work it out—it is likely to be 30c in the dollar.Mr SPEAKER: Well the member can ask his next supplementary if he wants to.Hon Steven Joyce: Well if he's unable to work out the answer to the first question can I ask him another one. Given his concern for Kiwi workers should someone earning $23 per hour face a marginal tax rate of 30c in the dollar if they are working a full-time wage?Hon GRANT ROBERTSON: I'll repeat the second part of my first answer which is that we're not proposing any changes in terms of what people will pay in terms of their effective marginal tax rate. What I can say is that somebody in the position that the member indicates would actually be paying an average tax rate of around 16 percent on all of the income that they earn.Hon Steven Joyce: Does he stand by his statement to interest.co.nz journalist Alex Tarrant on 14 September that I think"—and I quote—"all New Zealanders understand when they go to work every day pay tax on every cent of income that they earn that they want fairness to be seen across the system" and how does increasing the tax rate for median wage earners increase people's perception of fairness in the tax system and when I say increase I mean changing the law from 1 April next year?Hon GRANT ROBERTSON: I'm sure Mr Tarrant would have quoted me very accurately in that story. What we are saying is that no New Zealander will pay more tax—Hon Steven Joyce: That's not the point.Hon GRANT ROBERTSON: No it is. No New Zealander will pay more tax than they do now. Mr Joyce's package may well have seen changes in tax rates but no New Zealanders will pay more tax because that package has not been implemented.Hon Steven Joyce: Is it the Minister's view that fiscal drag should actually never be addressed so that any full-time worker eventually pays a marginal tax rate of 30c in the dollar?Hon GRANT ROBERTSON: All Governments would like to address fiscal drag. This Government has inherited a massive social and infrastructure deficit from the previous Government and our priority has to be to make sure that our schools and our hospitals work. We'll do that first because that's what a responsible Government does.Tamati Coffey: How does the tax on wages in New Zealand compare internationally?Hon GRANT ROBERTSON: OECD analysis shows that the average worker in New Zealand has the sixth-lowest net average tax rate among the 35 OECD members. Under this Government's policy no one will be paying more tax in the future than they do today but by rejecting National's tax cuts we can actually rebuild the social services New Zealanders rely on.Hon Steven Joyce: In light of his previous answer does he realise that the net $2.4 billion that he saves through this tax package has already been exceeded by the $2.8 billion in the tertiary package he's so fond of and does he think that builders on the median wage will be happy paying $1060 a year more throughout their working lives as a fair exchange for one year's free education for a law student?Hon GRANT ROBERTSON: I think builders on the minimum wage will be welcoming the fact—Hon Members: Median wage.Hon GRANT ROBERTSON: —the median wage will be welcoming the fact that there will be apprentices arriving fully subsidised and paid for by this Government. They'll be welcoming the fact that their hospitals will actually be working. They'll be welcoming the fact that more houses will be being built under the excellent KiwiBuild programme. They will be very happy indeed.Hon Steven Joyce: How does the finance Minister expect us to believe he cares about average Kiwi workers when his very first act as finance Minister for workers is to lift the marginal tax rate from that that is in law now and actually charge them $1060 more in tax from next April than is currently the case?Hon GRANT ROBERTSON: They will not be paying any more tax in the future than they do today because that member's package had not come into force. But what this member seems to believe is that the reward for working people is that their taxes will be cut. On this side of the House we're more ambitious than that. We want their wages to rise. We want a productive economy that delivers them higher wages."