IMF calls for tax reform and more disciplined govt spending

The IMF suggested the personal income and corporate tax rates could be cut, and a comprehensive capital gains or land tax introduced. Inflation is pushing low to middle-income earners into high tax brackets. As for interest rates, the IMF warned there was a risk the Reserve Bank of New Zealand (RBNZ) would need to raise the official cash rate (OCR) even more. On the flipside, it said rising net migration could ease labour constraints, which could lower inflation and bring interest rates down more quickly than expected. In fact, the IMF said financial stress caused by high interest rates should be addressed through financial stability tools like LVR rules.