National Finance spokesperson Nicola Willis stated that income tax cuts are off the table until after a return to surplus, projected for 2028/29 under Treasury forecasts.
National Aligns With Labour on Key Fiscal Settings
National released its fiscal plan on 12 October 2026. The document pledges no new taxes while ruling out broad income tax relief until sustained surpluses are achieved.
Finance spokesperson Nicola Willis said:
"While our fiscal plan shows a pathway to potential tax relief for working New Zealanders, now is not the time to cut taxes. National's priority is to get on top of the debt first so that our kids and grandkids aren't left with a bigger bill."
The plan matches Labour on the $2.4 billion annual operating allowance and a 2028/29 OBEGAL surplus target. Both parties allocate around $15.4–15.5 billion for additional health investment over four years.
Three-Way Comparison With Act
Act's plan, released 11 October, proposes deeper public service cuts of $9.9–10 billion and an earlier surplus. It also raises the superannuation age gradually.
National's net fiscal impact from commitments outside health funding averages $470 million per year. Funding sources include $431.2 million in foreign aid cuts and $583 million from welfare changes.
Treasury's PREFU 2026 revised the outlook upward. It forecasts a 2026/27 OBEGALx deficit of $6.8 billion, a $4.0 billion surplus in 2028/29 and $11.7 billion by 2030/31.
Net core Crown debt is projected to peak at 43.9% of GDP in 2027/28 before falling to 39.5% by 2030/31.
Voter Implications
Households will see no immediate tax relief under National or Labour plans. Health and infrastructure spending remain protected within existing allowances.
National leaves $7.5 billion in unallocated operating funding and $14.2 billion in capital allowances. Risks arise if cost pressures exceed these buffers.
Act offers structural reforms but with larger service reductions. All three parties reference the same Treasury baseline for credibility under the Public Finance Act.
