Higher than forecast tax revenues have been welcomed by New Zealand's Finance Minister Bill English, who says the funds are helping underpin an improvement in the Government's finances.
According to the latest figures, NZD719m (USD150.3m) more than expected was generated during the first eight months of the current financial year. The total tax take now stands at NZD37.6bn. The Government attributes this in part to a higher effective tax rate being paid by those in the workforce, with source deductions NZD266m greater than forecast. Tax from other individuals was also NZD326m above target.
Revenues also compare favorably with the eight month period to February, 2012. Wage growth, higher effective tax rates, and a rise in goods and service tax receipts all helped drive performance, with revenues up NZD2.2bn year-on-year.
Controlled government spending and bigger than expected net gains from government investment funds resulted in a NZD4.3bn operating surplus for the eight months to February, 2013. The forecast was for a NZD481m deficit.
According to English, the Government will now "need to build up sufficient surpluses to provide choices around repaying debt and investing more in priority public services." The economy remains on track to return to surplus by 2014/15, he added.