Explainer · New Zealand income tax

Income tax in New Zealand: what share of income is taxed?

Bracket rates such as 33% or 39% apply only to the slice of income inside that bracket, so the share of your whole income that is taxed, the effective rate, is lower. This page follows that one number. First it compares the 2026 income tax proposals on an income you choose, then it explains how the current scale works, how scales have changed since 1980, and how large the proposed changes are against past ones.

Last updated 8 October 2026. Party proposals are as reported in sources dated May to September 2026 and may change during the campaign.

Read this first. Income tax is only part of what any party proposes. This page compares income tax scales only. It does not count GST, ACC levies, KiwiSaver, Working for Families and other payments, council rates, or the other taxes parties pair with their income tax plans, such as wealth, inheritance, capital gains, company and land value taxes. Those can change how a household comes out under a party's package, in either direction, so judge any party on its whole package. For that, see policy.nz, a non-partisan guide to the 2026 election.

Income:

Every figure below is for the income chosen here: a whole year, before tax, in June 2026 dollars unless stated.

The 2026 income tax proposals at your income

Parties' income tax positions differ in kind. Labour, National and ACT propose no change to income tax rates and thresholds, so they match the current scale. The Greens and Te Pāti Māori propose new scales. NZ First's published policy is to make the lowest income tax bracket tax-free by 1 April 2027, but it has not published other rates or thresholds, so its tile is an illustration on stated assumptions, not the party's figure. Opportunity (TOP) pairs three tax rates with a Citizen's Income, which is a payment rather than a rate.

Want to go deeper? The sections below explain how these numbers are worked out and put them in historical context.

1. How a tax scale works (today's rules)

Income

2. Since 1980: how the share has changed

Scales have changed many times since 1980. Comparing them takes two choices. First, a dollar bought far more in 1980 than it does now, so a fixed dollar income, or a fixed dollar threshold, means different things in different decades. The panel below shows how large that effect is. Second, many older scales could not be reconstructed from the sources I found, so those years are shown as gaps rather than estimated.

Why adjust for inflation? See the effect on your chosen income

Income

Hover or tap the chart for a quarter's detail.

The grey line is the same number of dollars in every year. The orange line is the number of dollars it took in that year to buy what your chosen income buys today. The gap between them is why bracket thresholds can only be compared across decades once inflation is taken out.

Show dollars:

Effective tax rate over time at your income

Scale sourced directlyAssembled, secondary or rebate not verifiedGreens (2026 proposal)Te Pāti Māori (2026 proposal)

Income

Hover or tap the chart; the band breakdown for that quarter appears below it.

The Treasury paper puts the top rate at 66% up to 1987, 48% in 1988 and 33% in 1989 (60% in the 1980 schedule charted above). I could not find thresholds for 1981 to 1989, so those years cannot be shown as effective rates and appear as gaps. An OECD table lists 57% for 1987, which disagrees with the Treasury paper; I have used the Treasury figure.

3. The proposals in more detail

The cards at the top compare each proposal with today's rules at one income. These charts show how large those changes are against past ones, and how the proposals compare across incomes.

Income

The same comparison as blocks

Income

Effective rate across incomes

Income

Opportunity (TOP) (the party now campaigns as Opportunity) is not drawn here: its $19,400 Citizen's Income is a payment, not a tax rate, so a rate line would mislead without it (and would go negative below $19,400). Its land value tax (1.75% urban, 0.5% rural) and KiwiSaver changes are not income tax and are not counted anywhere on this page. Proposal thresholds are as reported; the Greens' bands are stated as "$10,000 to $19,999" and so on, and I treat them as breaks at $20,000, $40,000 and so on.

4. Sources, gaps and limits

Period	Scale (rate up to threshold)	Source

Page last updated 8 October 2026. Party proposals are as reported in sources dated May to September 2026 (The Post, 7 May; 1News, 21 June and 15 August; KPMG, 6 August; Te Ao Māori News, 26 August; nztax.tools, 20 September); check each party's own policy pages for any later changes.

Inflation: RBNZ table M1 (from Stats NZ), June 2017 = 1000. Governments used for colours: Wikipedia, List of prime ministers of New Zealand.

No verified scale: April 1980 to March 1990 (apart from the 1980 income year; the 66% and 48% top rates are noted above but I have no thresholds). Drawn as a hatched band.
Dashed lines mean the scale was assembled from several sources or relies on secondary sources, not a single IRD or Treasury table.
Low-income rebate: from 1995-96 to 2008 the scale is IRD's published effective one including the rebate (15% on the first $9,500). For 1980 and 1990-91 to 1994-95 it is the statutory scale, as I have not verified the rebate for those years. The Independent Earner Tax Credit (2009 on) is not modelled.
Rounding: bracket thresholds are shown exactly as legislated. Computed dollar amounts are rounded to the nearest $10, converted thresholds to the nearest $100, rates to at most three decimals and effective rates to one decimal.
Quarter granularity: a change part-way through a quarter takes effect for the whole quarter.
Inflation adjustment: incomes are converted at each quarter's CPI to the June 2026 level of 1359. With the toggle off, the same dollar income is used every year.