The Weekend Herald’s front page proclaims ‘$2 billion more in the pocket“. The article goes on to say “the average worker will get $15.66 a week”. But who is this ‘average worker’?
The Herald has used the average wage, which is $47,500 a year, but that’s not what the typical employed person earns because the average is pulled up by a few people on high incomes.
If you want to know the typical worker’s income, you want to look at the median, which is $40,000. Remember too, not everyone has a job. Retired people, beneficiaries, students, they have to buy bread too. The median income for all adults including people not working is $28,000.
2.6 million Kiwis have incomes below $40,000. They get nothing from these tax cuts. Except for 400,000 who are working and not getting Working For Families. They get $10 a week.
Most of the 1.4-1.5 million people who will get a tax cut won’t get much, either. The bulk of the money will go to the 50,000 people with incomes over $150,000.
So $2 billion in the pocket, but whose pocket?