Tax amnesty no medal winner
The Government’s tax amnesty demonstrates it is blind to the costs and risks facing many small business owners
struggling to make a living, says the Employers & Manufacturers Association (Northern).
“Government’s largesse in granting the tax amnesty is no medal winner for over 90% of businesses,” said Alasdair
Thompson, EMA’s chief executive.
“It would be far better for Government to establish a business compliance environment that doesn’t tempt small business
people to cheat on taxes in the first place.
“Simply because nine per cent of net earnings are not declared is no reason to let tax cheats off the hook.
“Instead of giving tax amnesties to cheats, the government should recognise its regime is overtaxing and overloading
small businesses with high legal and liability compliance costs.
“Many countries acknowledge that these are so great they provide tax relief to them all. For example, in Britain for
smaller businesses the first £10,000 of business income is tax free and the next £300,000 is taxed at only 19 pence in
the pound.
“In New Zealand all company profit is taxed at the high rate of 33 cents plus FBT rates up to 64%!
“A small business in the UK earning $30,000 pa pays little or no tax. Here it would pay at least $9,900 tax.
“If New Zealand’s business environment was fixed, tax amnesties wouldn’t even need to be considered.”
(97% of all New Zealand businesses employ 20 people or fewer, with 86% employing five or fewer.)