New Zealand increases tax on the rich and raises the minimum wage

Jacinda Ardern increases the minimum wage and imposes heavier taxation on the top two per cent richest of the population.

The latest news to be added to the long list of reasons why New Zealand totally kicks butt is only cementing Jacinda Ardern's status as perhaps one of the most progressive political leaders of our time.

One of the highest minimum wages in the world

The leader of the Labour Party has just raised New Zealand's minimum wage to NZ $20 (£10.17) an hour and set a 39% tax rate for around two percent of the population of the country representing its top earners.

New Zealand already formed part of the top five countries with the highest miminum wages in the world which was previously set at $18.90 (£9.61). The increase means that over 170,000 Kiwis, who were living on the previous minimum wage full time, will see their bank accounts increase by $44 weekly. The President of the Council of Trade Unions RIchard Wagstaff said:

We know that thousands of working people do not earn enough to provide for a comfortable life for them and their whanau [extended family]. They are the working poor; struggling to meet the costs of basics like food and housing.

And added:

Covid showed us all just how crucial many jobs are to the functioning of our society, jobs in health, cleaning, on our border or supermarkets. Many of these crucial roles are poorly paid. It's time we valued those being paid the minimum wage more, and this increase is one way of doing just that.

Taxing the rich

In addition to the pay raise, the country has also decided to impose a 39% tax rate on the higherst earners which is calculated to be anyone who makes more than NZ $180,000 (£91,000) per year. With this tax increase, the government predicts it will generate $550m (£279m) in revenue this year.

PM Jacinda Ardern explains that:

[the changes represent] real and long overdue improvements to the support we provide our most vulnerable. There is still much more to do, including building more homes, improving our health system, investing in education, training and job opportunities.
The UK might increase its minimum wage this week The UK might increase its minimum wage this week