An increased focus on the needs of New Zealand’s small business will be welcome from incoming Minister Stuart Nash, says online accounting software provider MYOB.
MYOB New Zealand General Manager Carolyn Luey says the new appointment within Cabinet gives small business owners a ‘voice at the top table’, especially when coupled with Mr Nash’s revenue portfolio.
“The approximately half a million enterprises which make up the SME sector, employing 30 percent of the workforce and generating 30 percent of our GDP, deserve a strong focus from the new Government,” says Carolyn Luey.
“Particularly important will be Minister Nash’s oversight of key revenue issues as well – SMEs are looking closely at the possibility of changes to the New Zealand tax regime and how they will affect their business, both in terms of cost and compliance.”
During the election campaign, Labour signalled a number of small business priorities, including providing a tax credit scheme for investment in research and development, making funding available for young entrepreneurs, and introducing a flexible withholding tax scheme to replace provisional tax, as well as removing late payment penalties.
“Managing provisional tax is consistently the most stressful issue for SMEs in New Zealand, reported over the six years of our Business Monitor survey. The good news is that changes are due to come into effect next year that will allow businesses to pay their tax directly from their accounting software platforms,” says Carolyn Luey.
Ms Luey says some small businesses are already expressing concern over the announced rise in the minimum wage, which will be increased incrementally to $20 over the next three years.
“Small business owners will be looking to see if that cost will be offset by any changes to the taxation and investment regime, which were signalled by the Prime Minister during the campaign as a possible outcome of the Tax Working Group,” says Carolyn Luey.
“Coalition partner New Zealand First, which holds the Associate Finance portfolio, also has a small business focus, which should be positive for the sector.”
Going into coalition negotiations, New Zealand First supported a reduction in the company tax rate to 25 percent over three years, the introduction of research and development credits and streamlining of the Health and Safety at Work Act.
“The concept of New Zealand First’s policy of a 100 percent depreciation rate for business equipment worth up to $20,000 has also proved very popular with small business in Australia.”
Ms Luey says MYOB is looking forward to seeing what new initiatives the new Government priorities to ensure small business interests are addressed as an important part of the New Zealand economy.
“Ultimately, when our Mum and Dad business owners are doing well, and are confident to employ people and invest in their own growth and development, the wider economy does well,” says Carolyn Luey.
“We welcome the new Minister and look forward to seeing him champion the needs of Kiwi SMEs at the Cabinet table.”