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

 

Trans-Tasman economy needs tax fix

Media release

3 September 2012

Trans-Tasman economy needs tax fix

A report by leading economic firms shows changes to tax laws in New Zealand and Australia could benefit the economies of both countries by billions of dollars.

Currently, companies based in either Australia or New Zealand with operations in the other country have their profits taxed twice, because neither country recognises the other’s system for offsetting tax credits.

NZIER and the Centre for International Economics have calculated that if the double taxation was removed the trans-Tasman economy would see additional growth of more than $5 billion over the next 20 years.

There would also be further significant benefit from removing the disincentive to invest, the report says.

BusinessNZ has strongly advocated the change. Chief Executive Phil O’Reilly says earnings, investment and saving would all be enhanced.

“If each country recognised the other’s system for offsetting tax credits, then investors in both countries would get a fairer outcome from their investment,” Mr O’Reilly said.

“Those dividends rightfully belong to those who invested in those companies and should not be dissipated through double taxation.

“Having mutual recognition of franking and imputation credits would slightly reduce the tax take in both countries, but this would be more than offset by the greater profits circulating in the economies of countries, boosting savings, investment and growth.”

The NZIER-CIE report has been forwarded to the Productivity Commissions of New Zealand and Australia as they consider the issue.

The Commissions are expected to report later this month, and BusinessNZ hopes the Commissions will recommend that both countries change their respective tax laws to fix the problem.

“Removing double taxation is one of the remaining issues standing in the way of a better trans-Tasman economy,” Mr O’Reilly said.

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Statistics New Zealand: COVID-19 Sees Record 12.2 Percent Fall In New Zealand’s Economy

Gross domestic product (GDP) fell by 12.2 percent in the June 2020 quarter, the largest quarterly fall recorded since the current series began in 1987, as the COVID-19 restrictions in place through the quarter impacted economic activity, Stats NZ said ... More>>

ALSO:

Climate: Scientists Release ‘Blueprint’ To Save Critical Ecosystems And Stabilize The Earth’s Climate

A group of scientists and experts produced the first comprehensive global-scale analysis of terrestrial areas essential for biodiversity and climate resilience, totaling 50.4% of the Earth's land. The report was published in Science Advances ... More>>

ALSO:

MPI: Independent Review Launched Into Assurances For Safe Transport Of Livestock By Sea

The Ministry for Primary Industries (MPI) has launched an independent review of the assurances it receives for the safe transport of livestock by sea. MPI Director-General Ray Smith says Mike Heron QC has been appointed to lead the review, which is expected ... More>>

ALSO:


Computers: New Zealand PC Market Grows Nearly 40% Due To Work From Home Demand

COVID-19 had large impacts on demand for PCs as businesses prepared for lockdowns by purchasing notebooks to mobilise their workforce. In the second quarter of 2020, New Zealand's Traditional PC market experienced a 39.7% year-on-year (YoY) growth ... More>>

ALSO:

Mediaworks: Reaches Agreement To Sell TV Operations To Discovery, Inc.

New Zealand’s largest independent commercial broadcaster MediaWorks and the global leader of real-life entertainment Discovery Inc. (“Discovery”) are pleased to announce they have reached a binding agreement regarding the sale of MediaWorks’ ... More>>

ALSO:

Ministry of Health: Public Transport Distancing Requirements Relaxed

Physical distancing requirements on public transport have been reviewed by the Ministry of Health to determine whether they are still required at Alert Level 2 (or below). The Ministry’s assessment is that mandatory face covering and individuals tracking ... More>>

ALSO:

NZHIA: New Zealand Hemp Industry Set To Generate $2 Billion Per Annum And Create 20,000 Jobs

A new report says a fully enabled hemp industry could generate $2 billion in income for New Zealand by 2030, while also creating thousands of new jobs. Written by industry strategist Dr Nick Marsh, the report has prompted calls from the New Zealand Hemp ... More>>

ALSO:

Stats NZ: One In 14 Employed People Report High Risk Of Losing Jobs

About one in 14 workers say they expect to lose their job or business by mid-2021, Stats NZ said today. A survey of employed people in the June 2020 quarter showed 7 percent felt there was a high or almost certain chance of losing their job or business ... More>>

ASB Quarterly Economic Forecast: NZ Economy Doing Better Than Expected, But Challenges Remain

August lockdown estimated to have shaved 8% off NZ’s weekly GDP, and 0.5% off annual GDP Economy now expected to shrink 5% (year-on-year) by end of 2020 Unemployment rate now expected to peak at 7.2% The latest ASB Quarterly Economic Forecast is less ... More>>

ALSO:

SAFE: Live Export Ship Carrying 5,800 New Zealand Cows Goes Missing In East China Sea

Livestock carrier Gulf Livestock 1 sent a distress signal at 4:45am NZT yesterday in the East China Sea. The area is affected by Typhoon Maysak. At 4pm a patrol plane spotted a lifeboat - with no people in it - and a man in lifejacket nearby. The ship ... More>>

ALSO:

FMA: Kiwisaver Fees Don't Match Performance

The Financial Markets Authority (FMA) today published an independent report into the passive and active investment management styles [i] used by KiwiSaver providers. The FMA commissioned MyFiduciary to test the extent that KiwiSaver providers were ... More>>