Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Tax Review Both Controversial And Conciliatory

The Tax Review's paper released today is both controversial and conciliatory, says Business NZ Chief Executive Simon Carlaw.

"Its suggestions for taxing owner-occupied homes will undoubtedly cause controversy, because the tax-free nature of home ownership is jealously guarded by New Zealanders. But over the longer term, such a move would free up money currently invested in housing so it could be put to productive use, to the benefit of our economy," Mr Carlaw said.

"The Review is also quite conciliatory, in that it points the way to a partial resolution of the argument over progressive versus flat tax,

"Progressive tax systems are favoured by many for their ability to redistribute money to the disadvantaged, while flat (proportional) tax systems are favoured because they are less damaging to business growth. The tension between these two different approaches is often the biggest 'political divide' in a modern economy.

"In indicating its support for reducing the number of steps within NZ's progressive system from 4 to 2, the Review may do much to bridge that divide.

"A system with only two rates of tax, with a threshold of $29,500 between them, would simplify tax collection considerably. The Review puts forward several different scenarios for the actual level of tax for the two steps - 16%/33%, 17%/32%, 18%/31% and so on.

"Company tax would be set at the same level as the higher of the two steps - and businesses would naturally want that level to be kept as low as possible in the interests of general economic growth. The Review's 20%/28% scenario is probably the best option for growing the economy while still allowing for tax-funded social spending." Ends

© Scoop Media

Business Headlines | Sci-Tech Headlines


DIY: Kiwi Ingenuity And Masking Tape Saves Chick

Kiwi ingenuity and masking tape has saved a Kiwi chick after its egg was badly damaged endangering the chick's life. The egg was delivered to Kiwi Encounter at Rainbow Springs in Rotorua 14 days ago by a DOC worker with a large hole in its shell and against all odds has just successfully hatched. More>>


Trade: Key To Lead Mission To India; ASEAN FTA Review Announced

Prime Minister John Key will lead a trade delegation to India next week, saying the pursuit of a free trade agreement with the protectionist giant is "the primary reason we're going" but playing down the likelihood of early progress. More>>



MYOB: Digital Signatures Go Live

From today, Inland Revenue will begin accepting “digital signatures”, saving businesses and their accountants a huge amount of administration time and further reducing the need for pen and paper in the workplace. More>>

Oil Searches: Norway's Statoil Quits Reinga Basin

Statoil, the Norwegian state-owned oil company, has given up oil and gas exploration in Northland's Reinga Basin, saying the probably of a find was 'too low'. More>>


Modern Living: Auckland Development Blowouts Reminiscent Of Run Up To GFC

The collapse of property developments in Auckland is "almost groundhog day" to the run-up of the global financial crisis in 2007/2008 as banks refuse to fund projects due to blowouts in construction and labour costs, says John Kensington, the author of KPMG's Financial Institutions Performance Survey. More>>


Health: New Zealand's First ‘No Sugary Drinks’ Logo Unveiled

New Zealand’s first “no sugary drinks logo” has been unveiled at an event in Wellington... It will empower communities around New Zealand to lift their health and wellbeing and send a clear message about the damage caused by too much sugar in our diets. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news