May is looming as a month of transtasman tax as governments here and in Australia finish preparations to their Budgets.
The Australian Budget is due for presentation on May 11 and the New Zealand Budget will be presented on May 20.
Both New Zealand Finance Minister Bill English and Australian Federal Treasurer Wayne Swan have been fielding constant questions about taxation issues.
Australia is committed to income tax cuts flagged in Mr Swan's Government and in previous budgets of the John Howard government.
Mr English has indicated major changes to the New Zealand tax system, including what is expected to be tax cuts.
Tax cuts would be delivered as promised, Mr Swan said.
The Australian Government was likely to use Treasury figures which showed working families were nearly $A4000 ($NZ5162) a year better off under Labor to justify an end to the annual budget expectation of tax relief and increases to family benefits.
In New Zealand, Mr English is expected to cut the top tax rate down to 33%, while adjusting other tax rates for people on middle and low incomes.
GST is expected to rise to 15%, with Mr English introducing payments to help pensioners and those receiving Working for Family payments.
The Australian Government wants to limit new spending to infrastructure projects and the $A5.4 billion in inducements Prime Minister Kevin Rudd last week offered the states and territories to win them over to his health reforms.
Mr Swan said the Government would manage that additional spending within the fiscal rules it had set itself to reduce the budget deficit and accumulated debt run up during Labor's response to the global financial crisis and recession.
Messrs English and Swan arecommitted to spending cuts in some areas and reducing current account deficits.
At the weekend, Mr Swan played down speculation the Government was preparing to introduce a resources rent tax which would cost Aust-ralian mining companies $A5 billion a year.
The plan to impose a new national resource rent tax, to be collected by the commonwealth, has been widely tipped to be part of the federal Government's response to the Henry tax review.
The review, and the Government's response to it, will be published next Sunday, AAP reported yesterday.
Mining company executives told The Weekend Australian a federal resources rent tax on top of the $A7 billion already paid in state royalties was the "worst-case scenario" and a "thermo-nuclear option" that would stop projects going ahead or limit expansion.
The review, carried out by Treasury Secretary Ken Henry, is believed to recommend the rate be set at 40% of mining industry profits and replace state royalties.
Mr Swan said he would not speculate on what may or may not be in the Henry review of the Government's response.
He was more forthcoming about another recommendation - simplifying the way Australians complete their annual tax return - likely to be in the review.
Nearly three out of four taxpayers use an accountant or tax professional to help them fill out their return.
That meant the system was too complex, he said.
An option might involve an optional tax return where taxpayers were sent a one-page statement from the Australian Tax Office setting out their income, any deductions based on occupation and an estimate of what they owed or would be refunded.
The taxpayer could then assess whether they agreed with the assessment, or reject it and lodge their own return.
The Henry Review is likely to contain some politically-sensitive measures, including a national road-user tax and changes to the way wine is taxed that has some in the industry already up in arms.
If the Government accepts the move to a volumetric tax on wine, the cost of a cask could triple while high-end wines could fall in price.
The review also considered the question of taxes on savings.
The current system encouraged people to risk their money in shares and property because of tax concessions, while savings in a bank account were taxed at the full rate as additional income.
