Episode Details

The OECDs latest economic survey on New Zealand highlights the countrys unique tax setup for retirement savings, such as KiwiSaver. The current TTE system, shared only with Australia and Turkey, taxes contributions and investment returns but exempts withdrawals. The OECD suggests this approach hinders long-term savings growth compared to the more common EET model, which exempts contributions and returns but taxes withdrawals. Shifting to the EET model would primarily affect higher earners, who hold half of all KiwiSaver assets and benefit most from exemptions. Industry voices weigh in, with some supporting tax cuts on growth to boost balances, while others caution about the impact on savers, employers, and government finances. The debate on revising savings taxes for fairness and growth is ongoing, with stability being the key concern for retirement planning.

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