QUESTIONS FOR THE MINISTER

NZBusiness asked readers to submit questions for Stuart Nash. Here is a sample – the full list can be found at https://nzbusiness.co.nz/ministerquestions

Q: “I’ve heard that there is possibly a lower tax rate being implemented for small businesses, either in their first few years of business, or for a turnover threshold. Is that true? When would it be implemented?”

A: The Government has asked the Tax Working Group to consider whether a progressive company tax, with a lower rate for small companies, would improve the tax system and the business environment. The Tax Working Group is expected to provide its final report back to the Government by February 2019.

Q: “Most small business owners fund their business from equity in the family home. Many Kiwis are going into retirement with no cash and many carry large mortgages to fund their business. With home ownership becoming more difficult, tightening access to bank funding and growing debts on homes, how will the government attract more capital into small business?”

A: It is important that small businesses have access to capital in order to grow. Recent regulatory reforms have included regulations enabling crowdfunding and peer- to- peer lending, as well as allowing small capital raises of up to $ 2 million over 12 months without needing to comply with disclosure and other regulatory requirements.

We are continuing to watch this space and are keen to hear from small businesses about what more the Government could be doing to support them to raise capital.

Q: “The IRD has made great strides in improving tax collection. It also loses over $ 200 million a year from liquidations. They close more business than anyone else because of unpaid taxes, and manage billions of late tax payments. What are the new government’s policies around small business taxation, considering the huge impact tax issues have on small business and huge losses the IRD incurs due to unpaid taxes?”

A: We're making a significant investment in Inland Revenue's business transformation programme. This will change tax processes so they fit with ordinary business processes.

IR is also working to help businesses get their tax right from the start. This involves providing more information and getting alongside businesses to help them to meet their tax obligations, rather than just chasing debt once businesses have fallen behind.

If businesses get into trouble they should contact the department as soon as possible so all options can be explored.