10pc of taxpayers now pay top rate

Figures compiled by National show workers are paying on average $2800-a-year more in tax than they were in 1999. Even the Government admits there has been a 38 per cent increase in the amount of tax collected since it took power.

But while National says the figure shows that workers are being penalised too heavily by Labour's decision to raise the top rate of tax on income over $60,000 when it got into power, the Government says it is an indication of a buoyant economy.

Labour increased the top rate of tax by 6c to 39c after the 1999 election saying it would use the money for health and education and promising that only the wealthiest 5 per cent of taxpayers would be affected. That has since risen to 10 per cent with wage hikes.

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