Fixing the over-taxation of KiwiSaver would add more than
$100,000 to the retirement savings of someone saving 6% of
income for 40 years on the average wage, Financial Services
Council chief executive Peter Neilsen said on Tuesday.
Launching the Fair Tax for Savers Campaign, Mr Neilsen said
if only real income from interest was taxed on term deposits,
a retired New Zealander with a $100,000 bank term deposit
would have their retirement earnings boosted by more than
$19,000 over 25 years.
There were more than 750,000 adults with term deposits -
average size $132,000 - and nearly two million people in
The campaign is asking members of Parliament to cut high
taxes on New Zealanders' long-term savings.
A special website was launched yesterday through which New
Zealanders could email their own and other MPs and party
The campaign was backed by Age Concern, Consumer New Zealand,
the Financial Services Council and the Taxpayers Union.
The campaign also involved inserting more than 120,000
FreePost cards in print media for readers to complete and
send to MPs.
Mr Neilsen said the campaign aimed to highlight and change
what were described as some of the highest taxes on
retirement savings to be found anywhere in the world.
Long-term savers, like those in KiwiSaver, were losing about
half of their KiwiSaver earnings through tax.