The Treasury is looking at a flat tax rate as part of a set of reforms aimed at closing the income gap with Australia.
In papers obtained by Radio New Zealand under the Official Information Act, the Treasury raises two options: the flat tax rate or cuts to taxes paid on dividends, interest payments and profits.
The changes would be funded by increases in GST, land tax and capital gains tax.
The Treasury says Finance Minister Bill English has the opportunity for a once in a generation reform of the tax system.
Radio New Zealand's political editor says the last time a flat tax rate was seriously proposed was when Sir Roger Douglas, was Labour's Finance Minister in the late 1980s.
Report from tax group expected in December
Treasury's work is in parallel with what a tax working group is doing. Both are looking at the same issues.
The expectation is that the working group will report back to the Government in December and present a range of options to it. Treasury is likely to make its final report after that.
