Income Gap

For the first three-quarters of the 20th century, average incomes in New Zealand were generally similar to those in Australia (as measured in terms of real GDP).

Over the last 30 - 40 years Australian incomes have grown at a faster pace than New Zealand ones, to the extent that they are now more than 30% higher on average. This is referred to in New Zealand as the income gap with Australia.

In fact GDP per capita in New Zealand is lower than that of every single Australian state and taken as a whole it is also lower on a pricing parity (PPP) basis.

As it is relatively easy for New Zealanders to migrate to Australia, the income gap creates an added incentive for doing so - an incentive to migrate in search of a better standard of living.

For this reason, the 2025 Taskforce was formed, with the aim of advising policy changes which will enable the income gap to be closed.

Income gap Articles

A Tax System for New Zealand's Future - TWG Report - Jan 2010

A summary of the Tax Working Group's (TWG) NZ tax reform recommendations, from the point of view of a New Zealand wage and salary earners

Raising NZ Incomes - 2025 Taskforce, First Report

In order to catch the essence of the 2025 Taskforce recommendations from the point of view of a NZ salary or wage earner we've included a selective summary of the key points here.