Common Economic Zone with Australia on Business Wish List

Common Economic Zone with Australia on Kiwi Business Wish List

•Simplifying provisional tax rules most popular economic policy for election year
•Most New Zealand businesses don’t want a return to 3 weeks annual leave
•Compulsory KiwiSaver with NZ investment popular
•Capital gains tax least popular possible policy

Almost half of all Kiwi business owners (42%) would vote for a common economic zone with Australia, although the policy would find little favour with the rural sector or retailers, according to the MYOB Business Monitor.

MYOB surveyed over 1000 local business on their support for a range of possible policies ahead of this year’s General Election, canvassing opinion on a raft of initiatives from taxation policy to employment conditions.

According to the MYOB Business Monitor, the policy most likely to find favour with business voters would be the simplification of provisional tax rules, with 74% of all business owners saying they would vote in favour of any party that is committed to making it easier for businesses to accurately determine and meet their tax obligations. Other strongly popular policies include offering tax credits for businesses that electronically file returns (61%) and waiving late-payment penalty interest for start-up businesses (58%).

MYOB general manager Julian Smith says Kiwi businesses feel the costs of compliance very strongly, and any party committed to reducing the administration around tax would win votes in this year’s election.

“This research is designed to highlight a range of policies that would find support in the forthcoming election. Although these policies could be described as ‘business-friendly’, the initiatives are not based on party lines, but represent the views of business owners of all kinds,” says Julian Smith.

“The policies the New Zealand business community would support are those that would make it easier to do business in this country, invest in innovation, and provide greater employment opportunities.”

According to the MYOB Business Monitor, more than half of all Kiwi business owners (55%) would vote for a single flat rate for business and personal tax – a policy that is particularly popular in Auckland, where 61% of businesses support it.

Business owners are also keen on support for innovation and business development from the Government, with 55% in support of cash awards for business innovation (including 61% of female business owners), and 52% in support of Government-funded training in online business development. Two-fifths (39%) of business owners would also vote for the introduction of compulsory KiwiSaver (with 24% opposed), providing a minimum of 50% of the fund is invested in Kiwi businesses.

“The survey has also highlighted that Kiwi employers are keen to strike a balance between the benefits their staff enjoy, and some of the potential costs of employment,” says Julian Smith.

“Employment is usually the most significant cost of any business – but employers recognise that positive workplace relations are very important, particularly when managing growth.”

The MYOB Business Monitor reveals that most New Zealand business owners would oppose a return to three weeks annual leave for their employees (with 43% opposed and only 18% in favour), but would also prefer to see a reduction in the time for a personal grievance to be lodged (48% would like to see this reduce from three years to one year), and are split on the extension of the current trial period legislation from three to six months (34% in favour and 32% opposed).

“Perhaps one of the most surprising policies that many Kiwi business owners are interested in is the concept of a common trans-Tasman economic zone and common ANZ currency,” says Julian Smith.

“This won a large amount of support, especially from the transport and professional services sector, although it found little favour in the rural sector and with retail and hospitality business owners.”

“Oddly enough, Kiwi men in business – at 49% – are far more keen on the policy than Kiwi women in business, of whom only 28% would like us to move closer to our trans Tasman cousins.”

And the biggest vote loser in this year’s elections?

“All parties would do well to steer clear of a capital gains tax. This would be a very unpopular policy, with 65% of business owners promising to vote against the party that has a capital gains tax as an election platform.”

Julian Smith says the kinds of policies strongly supported by business owners are those that reduce the costs of doing business, while focusing on opportunities for development.

“Coming out of a long, hard downturn, businesses want more help from the next Government, not just in terms of tax relief, but also in making running a business less complex and costly in New Zealand.”

“Coming into an election year, business owners will be scrutinising the policies of all parties closely. And while it is easy to characterise the business vote as a simple block, driven by tax cuts, what our research has highlighted is that Kiwi business owners are looking for a comprehensive mix of stimulus, cost reduction, and investment in growth and innovation.”

“All parties should look closely at how this would fit into their election campaign for 2011.”

ENDS

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