Survey shows room for improvement in the way NZ taxes business

17 Aug 2017

Survey shows room for improvement in the way New Zealandtaxes business

BusinessNZ-Deloitte Major Companies Tax Survey reportidentifies ten measures for a world class tax system

While New Zealand'stax system is generally considered to be in good shape, a survey of our biggestcompanies on a range of tax issues suggests there is room for improvement.

TheBusinessNZ-Deloitte Major Companies Tax Survey report, released today, suggestssome fine-turning is required to make sure our tax system is performingoptimally – and that we remain competitive.

BusinessNZ ChiefExecutive Kirk Hope says that changes to company tax have taken a back seat togovernment's focus on personal tax in recent years.

"But businesses, andlarge companies in particular, make a meaningful contribution to government'sability to achieve its goals and help pay for the public services andinfrastructure enjoyed by all Kiwis," says Mr Hope.

"In this context understanding whatour largest companies would like to see from the tax system is important. Butour survey report is aimed at informing and contributing to policy debate onthe tax settings that apply to all companies, not just the largest," he adds.

Deloitte Tax Partner Alex Mitchellsays the survey and its results are not focused simply on reducing tax forlarge companies.

"It is acknowledged that taxpayersboth large and small need to pay their fair share. Instead, the focus is onadjusting specific tax settings to drive appropriate policy and administrativeoutcomes that are also relevant to a much wider group of taxpayers," says MrMitchell.

Theresults of the survey are articulated through ten themes that came through loudand clear from the survey respondents:

  1. Provide certainty
  2. Eliminate black hole expenditure
  3. Help to strengthen buildings
  4. Restore depreciation for industrial buildings
  5. Maintain an internationally competitive rate
  6. Encourage research and development
  7. Put New Zealand's interests first
  8. Allow taxpayers some flexibility
  9. Treat commercial information like personal information
  10. Determine policy based on realities

"A greater focus onthese ten themes would help to ensure our tax system is competitive, efficientto run and of the highest integrity. These are the measures that make a taxsystem world class," says Mr Hope.

In May this year,BusinessNZ and Deloitte surveyed CEOs from the BusinessNZ Major Companies Groupand tax professionals from the Corporate Taxpayers Group on a range of taxissues including corporatetax rates, deductibility, depreciation and incentives to invest.

"Both BusinessNZ and Deloitte greatlyappreciate the engagement shown by our survey respondents who generously gavetheir time to complete the survey and provide their insights into corporate taxsystem," concludes Mr Hope.

The full surveyreport can be read or downloaded