New Zealand increases minimum wage and taxes to 2% with higher income New Zealand

Jacinda Ardern’s government raised the minimum wage to $ 20 an hour starting Thursday, which covers about 175,000 workers, in addition to some minor increases in unemployment benefits and sick leave.

The move is expected to affect up to 175,000 workers, according to government estimates, and increase salaries by a total of $ 216 million.

On the other hand, the executive has also increased taxes for those with higher salaries – more than $ 180,000 a year to 39%. They will account for about 2% of New Zealanders’ population and the move will generate an additional $ 550 million in revenue.

In the wake of the pandemic, many workers in key sectors received the minimum wage. This includes those who have worked on airports and borders and are considered the “first line of defense” against the virus. New Zealand adopted a suppression strategy (not a mitigation strategy) early on, and the first measure the von Ardern government imposed in March was even a mandatory quarantine for those arriving from outside, followed by a strict restriction.

In 2020 the unions had called for wages to be increased for these workers. “It’s very important to them. Part is the money, part is the dignity of being rewarded by the community for the sacrifices they have made, ”union leader John Crocker told New Zealand television TVNZ.

Jacinda Ardern said the changes are the fulfillment of a pre-election promise and that they “represent real improvements that should have been made long ago to serve the most vulnerable”.

The opposition criticized the measures. “Raising the minimum wage dramatically at a time of extreme uncertainty for small businesses is economic vandalism,” said Scott Simpson, spokesman for the National Labor Relations Party.

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