- Reform of the temporary tax, the new payment.
- The elimination or reduction of the use of interest for use of funds for the vast majority of taxpayers.
- The ability of contractors to choose the tax rate that corresponds to their needs.
- Cancel the current one percent monthly penalty from 1 April 2017, although the direct penalties and interest charges for late payments will continue to apply.
The package of tax reforms aimed at supporting small and medium-sized enterprises (SMEs) has been submitted to the Prime Minister of New Zealand, John Key, 13 April 2016.
It includes measures to simplify the taxation of small and medium-sized businesses, as well as reduce the cost of compliance with the requirements, said Finance Minister Bill English and Revenue Minister Michael Woodhouse.
“These measures will make tax easier and reduce the burden of interest and penalties, as well as help small businesses to carry out individual payments to their circumstances,” said English. “We want to make the tax system could fit into how the business works, not the other way around.”
The main measures included to the proposal:
Woodhouse said the changes are part of a wider program of business transformation, including new technologies.
“Approximately 30 to 40 percent of businesses are now using cloud accounting software. And expected, the number of enterprises will grow to 85-90 percent in the next 10 years. These measures allow small businesses to pay tax on the temporary account of their accounting software. “