The Tax Working Group considered this issue, and they noted that the fiscal impact of indexing income tax thresholds to inflation would likely be high, the benefits to low-income earners compared to others would be low, the benefits to higher-income earners obviously would be higher, and the resulting revenue loss and potential reduction in Government services would disproportionately affect low-income New Zealanders, and that the projected increase to the labour supply from the increased investment that would result from lower taxation was modest compared with the projected costs. 