New Zealand Must Match Australia’s Business Tax Cut

The government needs to reduce the company tax rate to at least match Australia’s if New Zealand is to remain competitive according to the Wellington Regional Chamber of Commerce

The Australian government yesterday announced a planned reduction in its corporate tax rate from 30% to 28%.

“If New Zealand does not at least match the Australian phase-down it risks losing jobs and investment across the Tasman. Of course it would be even better if we moved ahead of Australia,” said Chamber CEO Charles Finny.

“It would be a great opportunity to make the changes as part of the upcoming tax package expected to be announced in this month’s budget.

“The cuts should be made in addition to the expected reductions in personal rates already foreshadowed.

“It is likely that Australia and other countries will continue to lower their company tax rates over the next few years and so the New Zealand rate needs to be lower if we are to maintain international competitiveness.

“The small OECD country average was 26% in 2008. New Zealand’s rate of 30% is too high.

“The reduction should be funded by reductions in the growth of further government expenditure,” Mr Finny concluded.

ENDS

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