Labour offers support if tax cuts deferred

Labour leader Phil Goff has offered his party's support to the Government should it change its stance on tax cuts.

Air New Zealand chief executive Rob Fyfe has questioned whether tax cuts are the best way to stimulate the economy, prompting Prime Minister John Key to confirm the April 1 tax cuts were definitely going ahead.

But Mr Goff said the world had changed since National last year campaigned on introducing tax cuts.

"The outlook for our economy has worsened significantly and job losses are forecast to increase," he said.

"The Government's approach to handling the crisis needs to keep up with this changing environment.

"Labour stands ready to support the National Government changing its stance on these tax cuts."

Mr Key confirmed they would go ahead but was less equivocal on those planned for 2010-11, saying: "I believe them to be (safe).

"On the best knowledge I have at the moment, that's not my expectation (to drop them) ... We live in dynamic times; I wouldn't jump to conclusions."

Several other governments had included personal tax cuts as part of packages to deal with the tough economic times, Mr Key said.

"The April 1 tax cuts are going ahead, we believe that they will stimulate the economy, we believe that they will put money in the pockets of New Zealanders who have waited a long time for them and we think we are on the right track."

Labour did not believe in tax cuts - it had had nine good years in which it could have delivered them, Mr Key said.

"Which would have put New Zealand, in our view, in a much stronger position."

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