- CA ANZ looking for three years of Government action
- However, the new Government has a limited plan for economic recovery and a sustainable future
- It should make greater use of the work already done, for example by the Tax Working Group and the Productivity Commission
"Please no more working groups, Cabinet-table impasses or visionary talk. Let's get moving," said Peter Vial FCA, CA ANZ's New Zealand Country Head.
"Any lost time by the Government will be damaging for individual Kiwis, their communities, businesses and the environment as we all deal with the impacts of the pandemic and understand what it may hold in the future.
"If New Zealand is to avoid fulfilling the prediction of the International Monetary Fund that we will fall further behind Australia economically in the next five years, then longstanding issues such as productivity, sustainability of the tax system and child poverty need to be addressed.
"This Government was given a mandate to lead and it must be bold and use it."
Titiro whakamuri, kōkiri whakamua
Understand your past to move forward
The big question is: what direction of travel? The new Government only has a patchy plan for economic recovery and a sustainable future, as articulated during the election campaign, to guide it.
“Any lost time by the Government will be damaging for individual Kiwis, their communities, businesses and the environment as we all deal with the impacts of the pandemic and understand what it may hold in the future.”
"Time is tight to come up with a coherent evidenced-based portfolio of policies, but short cuts exist in making greater use of the work already done by the Tax Working Group, the Productivity Commission, the Welfare Expert Advisory Group and the UN's Sustainable Development Goals."
The decision to implement the TWG's proposal to reintroduce building depreciation for commercial buildings is a good example of a tax measure that is sensible and fair and focuses on infrastructure and investment.
As well as improving taxpayers' cashflow (by reducing tax obligations), reintroducing building depreciation adds to the sustainability of the business and surrounding community by encouraging further building improvements and earthquake strengthening.
It adds a substantial 'pro' for those looking to develop or purchase new property to expand their business
Other positive tax measures, currently languishing in Parliament, should be quickly implemented. For example, changes to feasibility expenditure rules are sitting in a tax Bill awaiting its second reading.
CA ANZ believes these feasibility proposals should go further. With the right settings and enhanced certainty these changes could incentivise businesses to grow and explore new products and markets.
The United Nations Sustainable Development Goals (SDGs) also provide a ready-made framework for a COVID-19 recovery plan which leads to a greener, more inclusive economy and a stronger, more resilient society.
The SDGs already enjoy widespread support in New Zealand. The Government describes the 2030 Agenda for Sustainable Development as a "collective blueprint" for the country.
Investment in technology must also be front and centre of the Government’s plan for economic recovery.
The tech sector represents a significant and growing export sector in New Zealand. Government investment and support are key to its continued success.
More generally, our future prosperity depends on our ability to increase productivity by embracing new and existing technologies as we rebuild from the impacts of COVID. Key to this is ensuring that we invest in training and developing a sustainable pool of tech-capable employees.
CA ANZ's call to action:
- Listen to and engage with businesses more
- Move beyond 'shovel-ready' projects to include more technology and services projects
- Ensure tax policy and tax administration work together so the tax system does not impede productive business investment
- Increase investment in technology
- Leverage the interconnected, long-term nature of the wellbeing priorities and climate change
- Take a broad approach to measuring the recovery, beyond just GDP
4 members in new Parliament
Simon Watts CA, who stood for National in the North Shore electorate, is a first-time MP.READ MORE