Cross-party push to overhaul Working for Families and curb surprise debt
Politicians from National, Labour and the Greens are urging changes to the Working for Families tax credit to prevent families from receiving unexpected debt notices.
A recent review of New Zealand's Working for Families tax credit recommended regular income checks to avoid large end-of-year debt bills for families. Inland Revenue is working with other government bodies to explore options, including a shorter assessment window, and has already updated residency rules while preparing an information-sharing pact with Customs for April. One outlet said it is continuously seeking ways to modernise the scheme and is weighing the pros and cons of more frequent assessments.
Labour's revenue spokesperson argued that families should not be hit with surprise debt and called for the agency to improve communication and reconsider staff cuts. The Green Party pushed for a simplified, single-credit system and better debt-handling procedures, noting that only 24 percent of families received the correct entitlement in the 2022 tax year.
Why it matters
Reforming the credit could protect families from unexpected debt and improve the fairness of a major welfare program.
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