The forecast inflation rate is not included in the online tax calculator which helps people figure out the impact of the budget on their taxes, Finance Minister Bill English confirmed today.
The budget last month included income tax cuts across the board. Budget documents showed the cuts off-set by the increase in GST to 15 percent.
Labour today said the Government had misled the public by overstating the benefits of the tax cuts.
It was "unacceptable" the Government's online tax calculator did not take into account Treasury's forecast of 5.9 percent inflation in 2011, the party's finance spokesman David Cunliffe said.
The calculator also did not include potential increases in rent, ACC and childcare costs, he said.
Labour's calculations said minimum wage earners would be worse off until 2014 under the changes.
Mr English said the online calculator included income tax cuts, the rise in GST and compensation in Working For Families, Superannuation and benefit payments.
It did not include forecasts, he said.
The calculator had seen 360,000 page views from New Zealand, Australia, the United Kingdom, Europe, the United States and Asia.
Mr English said the website was "conservative" in its estimates as it assumed people spent all their income.
Countering Mr Cunliffe's figures, Mr English said forecasts showed wage growth was projected to be greater than price increases over the next four years.
Mr English skirted around the subject of the calculator in Parliament today until Speaker Lockwood Smith told him to answer the question.