Hon Stuart Nash
Minister of Revenue
Minister for Small Business
A significant package of tax reforms will be pushed through all stages in Parliament today to throw a cash flow lifeline
to small businesses.
Revenue Minister Stuart Nash says the COVID-19 Response (Taxation and other Regulatory Urgent Measures) Bill gives
businesses more than $3 billion in tax refunds as they deal with the economic impact of the virus.
“This response delivers the single biggest government support package to businesses via the tax system in modern New
Zealand history, and more is yet to come,” Mr Nash said.
“As the Prime Minister and Finance Minister have said we are constantly monitoring the situation for business and
adjusting our support as required. Just yesterday we indicated additional support will be coming for commercial leases.
“We will keep supporting business and jobs where we can to cushion the blow of the virus and ensure New Zealand is well
positioned for recovery.”
“Today’s changes mean cash could start flowing to businesses via the tax system as early as next week. Many small and
medium enterprises (SMEs) are feeling the pain now. We are moving urgently to get cash into their hands as quickly as
possible, by taking current losses back to a prior year.
“My strong advice to businesses is to talk to their accountant, bookkeeper or tax agent, or log onto the MyIR portal as
quickly as possible to ensure they take advantage of the government support as soon as changes come into effect this
“The tax refunds will be a cash lifeline for businesses with non-wage fixed costs, like rent, interest and insurance.
Some don’t want to take on extra debt with a bank loan. Without this support these otherwise viable SMEs may be forced
“The changes were signalled two weeks ago and design features have now been finalised after discussions between Inland
Revenue and external tax practitioners. I am grateful to the accounting and legal profession and IR officials for their
rapid work on this legislation.
“The omnibus bill deals with tax and regulatory changes to support businesses and others get through the economic shock
caused by COVID. The main measures will:
• introduce a tax loss carry-back regime to provide cash flow quickly to businesses, by allowing losses to be carried
back one year;
• allow IR to change due dates, timeframes or other procedural requirements for tax returns for taxpayers affected by
• ensure the treatment of benefits and pensions paid to New Zealanders stranded overseas is consistent with the
treatment of equivalent payments in New Zealand;
• Bring forward the commencement date of certain protections relating to high-cost consumer credit contracts;
• Prevent famers and others working with animals having to call in vets to undertake minor surgical procedures
during the lockdown; and
• extend the timeframe for certain Crown entities to provide planning documents to responsible or shareholding
“Other tax changes
just before the lockdown involved a $2.8 billion support package for business.
“It gives $2 billion in tax deductions to landlords through depreciation on commercial buildings. It removes 95,000
taxpayers from the provisional tax regime by raising the tax threshold to $5,000; allows businesses to claim back more
for spending on low-value assets like laptops and phones; and allows interest to be waived on late payments.
“The wage subsidy has also been a vital factor in small business survival. Around 97 per cent of businesses who received
the subsidy are either sole traders or firms employing fewer than 20 staff.
“More than $1.25 billion has been paid to about 188,000 sole traders. A further $4.27 billion has gone to 160,000 small
businesses that employ between one and 19 staff. Almost 8,900 medium-sized firms, with 20-99 staff, have been paid $1.3
“SMEs can also call on government support to pay for professional advice to plan for survival and recovery from the
economic shock caused by COVID. A $25 million business consultancy fund will pay for tailored specialist support such as
business continuity planning, finance and cash flow management, HR and staffing issues.
“The global pandemic and economic crisis is hitting every nation hard. We are moving to cushion the blow for businesses
and workers in this country as Alert Level 3 opens up the economy to prepare for recovery,” Mr Nash said.
Further information about the Bill will be available here after it is tabled in Parliament at 2.00pm: http://taxpolicy.ird.govt.nz/
Note to editors:
Business support delivered outside the tax system includes:
• Up to $12 billion in wage subsidies, meaning affected businesses receive support directly from the Government to keep
their staff on
• $500m boost for health, because the best medicine for the economy is getting the virus under control
• $126m in COVID-19 leave and self-isolation support for people who are unable to work because they’re sick,
self-isolating or caring for dependants
• $2.8b income support package for our most vulnerable, including a permanent $25 per week benefit increase and doubling
the Winter Energy Payment for 2020
• $100m redeployment package, to keep more New Zealanders in work
• Initial $600m package to support the aviation sector and protect New Zealand’s supply chains
• Six-month mortgage principle and interest payment deferral for affected individuals and SMEs
• $6.25 billion Business Finance Guarantee scheme to leverage the government’s balance sheet helping banks to support
otherwise viable firms so they stay in business and employing New Zealanders
• $60 million estimated annual savings to business from forthcoming changes to the tax loss continuity rules
• New measures have been announced to support stability in commercial property transactions, and further options for
commercial rent relief are currently being considered