The GST hike means a rough ride ahead for small businesses

Published: April 23, 2010

by David Clendon

It’s good to see that other people than just the Green Party are concerned about the disruptive impacts of the GST rise on small businesses in New Zealand:

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10640159

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10640278

Funnily enough, we released a press release yesterday on the exact same topic. Our press release revealed there has been no specific research or consultation carried out by the Government on the effects of the GST rise to small business sector. This information was uncovered through a series of QWAs (Questions for Written Answer) directed to the Minister of Small Business that were redirected to the Minister of Finance.

Although, there are some that seem to think that the GST rise will have little impact, the recent survey carried out by accounting firm Accomplish show this is not to be case:

http://nz.accomplishglobal.com/resources/gst-survey.html

Interestingly, 450 small-medium business owners completed the survey and 57.08% of them either disagreed or strongly disagreed with the Government’s plan to increase GST to 15%. Even though the Government seems unconcerned with running its ideas past those that will be most highly affected, let’s hope they take notice of this clear message from small business owners. Let’s also hope the Government takes a lesson from this and realises the importance of talking and listening to the business sector before deciding what is best for them.

Published in Economy, Work, & Welfare by David Clendon on Fri, April 23rd, 2010   

Tags: 15% GST, Accomplish, David Clendon, economics, GST rise, small business, smart business, SMEs

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1. sprout

   Posted April 23, 2010 at 1:21 PM

   Good post, David. It almost appears that this Government doesn’t accept that governance is a complex task and the quality of any decision is based on the quality of the advice and information you base it on. I’m just waiting for the penny to drop with the majority of voters that this National Government not only doesn’t listen, but doesn’t want to!

   Like or Dislike: 6  1 (+5)
2. samiam

   Posted April 23, 2010 at 1:32 PM

   So who should pay for the deficit?
   NZ has a consumption problem, this is a consumption tax. I thought that would appeal to you.

   Like or Dislike: 1  0 (+1)
3. Valis

   Posted April 23, 2010 at 1:39 PM

   It may have that one good attribute, but is terribly regressive and too unfocussed compared to say eco taxes.

   Like or Dislike: 5  1 (+4)
4. sprout

   Posted April 23, 2010 at 1:58 PM

   GST is a simple tool applied to a complex problem, end of story!

   Like or Dislike: 5  0 (+5)
5. Owen McShane

   Posted April 25, 2010 at 10:51 AM

   Part of the increase should be recycled back to the local districts that generate. This way the GST spent by tourists would be spent where they impose their loadings.

   Of course, you would can the Development contributions which make affordable housing impossible in NZ which would be another benefit.

   Like or Dislike: 0  0 (0)