New Zealand has enacted the Taxation (Annual Rates for 2019–20, GST Offshore Supplier Registration, and Remedial Matters) Act. I honestly don’t know how they come up with these catchy names, I really don’t.
The legislation will introduce new GST collection obligations for low-value imported goods, and will make a number of “fairness changes” to the tax regime; one of the biggest changes will require offshore businesses that supply low-value goods (those worth NZD1,000 (USD667) or less) to New Zealand to collect GST. From December 1, offshore businesses who supply more than NZD60,000 of services and low-value goods per year will pass on GST directly to Inland Revenue.
For more information on this, and other topical international tax matters, please visit: https://www.cchgroup.com/roles/corporations/international-solutions/research/global-tax-weekly-a-closer-look
According to the conclusions of a public consultation by New Zealand’s Tax Working Group, the majority of New Zealanders want major changes to the tax system. Who doesn’t! Will they get them? Probably not – but why so sure? Recent history of tax developments, say over the last 20 years or so, is littered with discarded “root and branch” tax reviews, undertaken by panels of independent experts and other worthies, whose conclusions ultimately get shelved, kicked down the road, or punted into the long grass.
Furthermore, recent experience has taught us that the simplification of tax regimes isn’t as simple as it first sounds. Few would argue convincingly that the US tax code is much simpler because of the Tax Cuts and Jobs Act, especially for individual taxpayers with their own business, which, apart from multinational businesses, tend to have the most complicated … Read More »
Global competitive rankings, like the latest Doing Business Index from the World Bank, often throw up some surprising results. New Zealand usually performs well in such surveys, but who’d have thought that it is literally the best place in the world to set up and run a company from a regulatory, administrative, and tax point of view – better even than low-tax Singapore, according to Doing Business 2017?
Or, perhaps even more startling, that Denmark – yes, high-tax, high-spend Denmark – the object of derision from the right and praise from the left, during the US presidential election campaign, is the fourth best place to operate a firm, exceeding laissez-faire Hong Kong as a business location? Similarly, Sweden’s brand of social democracy is often criticized as overbearing and fiscally unsustainable. Yet, Sweden is just behind the United States in ninth place.
If … Read More »
The European Union has flatly denied that New Zealand will be placed on a new blacklist of tax havens stemming from its probe into the Panama Papers. But no smoke without fire as the saying goes, and the idea must have come from somewhere. Well, as it turns out, that somewhere was a non-legislative resolution proposed by a member of the European Parliament that New Zealand was worthy of investigation because it made an appearance in the documents leaked from Panama law firm Mossack Fonseca. And it seems that New Zealand’s foreign trusts regime has put the country on the radar of the international transparency campaign.
Certainly, if anonymity is top of your list when organizing your financial affairs, you could do a lot worse than make use of a New Zealand foreign trust, which has been one of the most … Read More »
I’m not sure how you can come to the conclusion that tax compliance has got 23 percent easier from one year to the next. But apparently it has in New Zealand. Still, this isn’t a criticism. If the pain of interacting with the tax man has abated by almost a quarter, this is no bad thing. In fact, it might surprise some to learn that New Zealand is a pretty welcoming place for investors altogether, according to the various barometers measuring the tax and business climate in countries around the world. The World Bank says that New Zealand is the easiest place in the world to start a business, with company founders encountering just one procedure and the process taking just half a day on average. This compares with an OECD average of five procedures and a completion time … Read More »
In the parlance of global trade, “dumping” occurs when products are exported to one or more countries at below the price they are sold in their home market, or at below cost price. It is generally perceived that such pricing practices are deliberate and predatory: producers of widgets in country A slash prices to the point where producers of widgets in country B simply can’t compete, enabling the former to grab a larger share of country B’s market for widgets. To protect domestic industry, the remedy that country B’s government will most likely use, after much lobbying from said injured industry, is anti-dumping duties. These force up the price of widgets imported from country A, thereby leveling the competitive playing field. Simple but ingenious, no? Well, no. Where do we consumers of widgets stand in all this? Nowhere, is the … Read More »
There is a tale of two countries Down Under this week, with both New Zealand and Australia launching their annual budgets. Both have right-wing governments, but whereas New Zealand is reaping the harvest of four years of sensible, low-key, pro-business taxation policies, turning in annual surpluses as far as the eye can see, Australia’s equally pro-business government is left with the bitter stubble of seven years of left-wing Labor rule, and is forced into a tax-raising budget to try to repair some of the damage done to the economy by Labor’s spendthrift policies. The Australian Labor Party did occasionally make gestures in the direction of business, but that’s all they were – virtually every substantive measure taken by the last government was either populist or overtly negative for the economy.
One other important difference between the twin countries, one much bigger … Read More »