This figure shows how personal income tax grew from 1950 and came to dominate the tax take over the 1970s and 1980s. New Zealand has had a history of a high proportion of direct taxes to indirect taxes. The historic resistance to introducing indirect taxes such as sales tax was that it was likely to prove very unpopular with voters. Sales tax takes a greater chunk out of lower income earners’ wallets – as they earn less yet pay the same tax amount as wealthier people.
Note that this Treasury data includes customs duties in its calculation of income tax.
Te whakamahi i tēnei tūemi
Te Ara - The Encyclopedia of New Zealand
Source: Statistics New Zealand
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