An eye on tax: What the new coalition Government means for businesses

An eye on tax: What the new coalition Government means for businesses

With the general election behind us and a new Government formed, attention now turns to how the coalition will work together to deliver on their pre-election promises. With a range of potential tax policies discussed during the election campaign, there will be keen interest in the December mini-budget and how these policies may be applied. 

As part of our November 2023 BDO Business Wellbeing Index video series, BDO Tax Partner Iain Craig sat down with business journalist Madison Reidy to discuss New Zealand’s current tax landscape and what might change in the coming months. 

 

Key highlights from the discussion include: 

  • A mini-budget is expected in December. Many of the policies National campaigned on may be implemented at this stage, including personal tax cuts, updates to some of the Labour-initiated changes to residential property, changes to depreciation on commercial buildings, and the unwinding of things like the EV rebate and fuel taxes. 

  • Watch out for commercial building depreciation and R&D tax credits. National are likely to be reluctant to let go of any of the tax policies they campaigned on, but we can expect there to be negotiations with the Coalition Government that might impact those policies. Things to look out for include whether the commercial building depreciation tax break will be removed and whether there will be a wind-back in R&D tax credits.  

  • Compliance matters continue to create complexity for business leaders. The BDO Business Wellbeing Index shows 24% of business leaders say compliance - including tax – is causing them to feel less mentally healthy than normal. Ever-increasing amounts of disclosure and change are creating uncertainty and complexity for some business leaders, taking away time and resource.  

  • Companies should mitigate this by staying on top of their compliance. This includes filing GST returns and PAYE on time, getting tax returns in, and managing provisional tax. One option that some businesses are taking to help manage this is outsourcing payroll or other financial functions to an external party.  

To learn more about tax in New Zealand, read more of our Tax Insights or reach out to your local BDO adviser.