The Government is pushing back against changing New Zealand's tax system, with Finance Minister Nicola Willis instead blaming Labour for the "economic mess" it left behind.
Her comments come as Labour leader Chris Hipkins on Sunday called for a debate about New Zealand's tax system, saying currently it's "inequitable", "unsustainable" and "broken".
"As the way we live and work continues to change, with a smaller proportion of the workforce earning taxable salary and wages, reform of our tax system won't just be a matter for the idealists, it will be an economic necessity," Hipkins warned.
"Now is the time to have that debate. After the election I said that all options around changes to the tax system were back on the table and I meant it."
Hipkins said his party was set to release a series of discussion documents on key issues it will be working on over the next two years - one of those will be on tax.
"It will set out some of our options for future tax policy. It's intended to help inform the debate, but how we shape it will be up to us."
However, Willis clapped back at the suggestion.
"Labour can't blame this Government for the economic mess they left behind," she told Newshub.
"Their only answer to every problem is just more tax. We are focused on reducing the tax hardworking people pay and that will come through in our Budget."
ACT leader David Seymour agreed, saying: "Kiwis just had six years of Labour throwing money at every problem, but not getting results.
"More tax might be the solution if the problem was a lack of money, but the real problem is a lack of results for the money spent."
He said New Zealand needed more effective spending and that's what the Government was focused on.
Deputy Prime Minister and NZ First leader Winston Peters tweeted his response - quoting Winston Churchill.
"As Churchill once said 'for a nation to try to tax itself into prosperity is like someone standing in a bucket and trying to lift themselves up by the handle'," he wrote.
"Chris Hipkins' irrelevance has been highlighted with his lack of understanding of this simple fact. His terminal plan to take Labour further to the lunacy of the economic and social left is palpable."
However, Green Party leader Chlöe Swarbrick told Newshub she welcomed the "desperately long overdue conversation on tax reform", saying it was necessary for a fairer economy.
"The Government is choosing to increase inequality and make life harder for those struggling to get by - paying for billions in landlord tax cuts while chopping kids school lunches, the public service and environmental protection," she said.
"While National struggles to patch together its austerity budget serving vested interested and gutting public services, New Zealanders must know that these are political choices, not inevitabilities."
Swarbrick also noted an Inland Revenue (IRD) report which found New Zealand had a tax system that sees the wealthiest pay an effective tax rate less than half of that of the average New Zealander.
"Labour's own commissioned evidence from IRD last term told us we have trickle-down tax settings, which the current Government intends to double down on, grow inequality, rob us of productivity and the investment necessary for functional public infrastructure that all of us rely on - from our hospitals to our schools to our transport network. The IMF's mission statement just this past week also highlighted exactly this."
National had previously pointed Newshub to tax expert Robin Oliver, who used to be the deputy commissioner at IRD, for comment on its tax policy.
In a statement on Sunday, Oliver said the Opposition should take the time to review such an important issue as how we should raise taxes to fund the government.
"This should be done in a rational coherent way," he said.
"It is important to identify what taxes are doable rather than theoretical aspirations that would never work in practice. You then need to consider the economic and social impact of options."
Oliver said taxing investment or savings more might sound good but it likely means less investment or savings leading to lower productivity and lower wages.
"So be careful and considered," he warned, adding that those making such decisions needed input from those with tax expertise.
