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When small businesses succeed, New Zealand succeeds: Stuart Nash
22 Apr 2018
“Small businesses are the backbone of our economy. They employ almost a third of our workers and contribute over a quarter to our GDP. No matter what the ambition of our small businesses are, as a Government we want to give every small business in New Zealand the tools and the confidence to meet their potential, and realise their goals as a business”. With these words, Stuart Nash, minister for Revenue and Small Business, expressed the government’s resolve to support the SMEs.
The minister was speaking at an INZBC event [India NZ Business Council], named India Unplugged. The theme of the discussion was the contribution of SMEs in international trade and how to empower them. The event held on 18 April, was hosted by EY Auckland.
The event saw a great turnout of industry leaders and SME directors who had a good discussion on a lot of business issues. Reiterating the involvement of the Indian community in the SME sector, he revealed some great numbers.
Acknowledging that the Indian small businesses play an important role in our New Zealand economy, he said, “You might be interested to know that Indian business owners represent around 3 percent (10,137 people) of all business owners in New Zealand and over 66 percent (6,684) of these are in Auckland.”
“Almost a third (29 percent) of all Indian business owners in New Zealand are chief executives, general managers, and legislators and I appreciate the role that the INZBC plays in encouraging connections between India and New Zealand on doing business and around facilitating business development.”
Interestingly, The event came just a day before the government announced the R&D incentive proposal. Paul Dunne, Partner-Tax, EY Auckland, was also presenting on the tax systems and changes in the international trade.
Paul commented, “It was very clear listening to Hon Stuart Nash at the INZBC event held on Wednesday at EY, that the new Government is keen to assist SMEs and is very interested in hearing from businesses on the proposed tax reform for New Zealand. New Zealand Government has appointed Sir Michael Cullen to lead a Tax Working Group and this provides an ideal forum for SMEs to air their concerns regarding the current tax system and what they will like changed the most.”
“Additionally, the Government has just released its Discussion Document on the R&D incentive proposal and again it is important for SMEs to influence the design of the new R&D incentive scheme so that they can realise the full potential of the scheme. Some of the details of the proposed R&D tax incentive are outlined in the discussion paper, however, all of the details are still up for discussion.”
Paul added that furthermore, the Government has embarked on a major Business Transformation project modernising Inland Revenue’s technological platform and this will assist SMEs in managing their tax obligations.
“One such innovation includes the introduction of new ‘Accounting Income Method’ which the Minister emphasised in his talk and SMEs should explore using this tool for managing their provisional tax obligations”, he said.
EY has been supportive of the initiatives taken by INZBC to help develop the right environment for International trade.
Sanjay Kumar, Executive Director, Tax at EY commented that both locally and internationally, the tax systems are undergoing massive changes as Governments across the globe are coming to grips with new challenges facing economies due to changing business models, technological disruptions and ever-increasing complexities concerning global trade.
“The tax environment facing SMEs is fraught with challenges particularly for those who are looking to expand into offshore markets and/or trade with overseas customers. Receiving guidance and advice early on for optimal operating structures is essential”, said Sanjay.
Andrew Bashford, Head of Corporate & Institutional Relationships at Westpac was representing the bank, who is one of the strategic partners of INZBC. He presented a very well researched presentation on ‘SMEs and the India NZ
Considering India will also drive the shift in global economic power and could overtake the US to be the world’s second-largest economy in PPP terms by 2050, he said it’s better that the companies are better prepared for the coming change in the world order.
Andrew commented, “SMEs dominate the business landscape in New Zealand and have a significant opportunity to expand their businesses by growing internationally. India and other emerging markets are expected to drive global economic growth and trade activity into the future. This shift in economic power is a trend SMEs should look to capture. By lifting their ambitions and accessing the support, resources, and capabilities needed to implement the growth plans and manage the risks, substantial business, economic and societal benefits can flow”.
Sameer Handa, an executive board member at INZBC acknowledged EY for hosting the event and supporting the council in its activities. “It is due to the support of the corporate houses like EY and Westpac, that we as a Council can better serve our members and industry in general. We acknowledge their support in helping us take our objectives forward”.
The event was positive in acknowledging the power of SMEs for the growth of the economy. It can be summed up in the words of the minister, “We know that with the right mix of ambition, innovation, and support, that Kiwi businesses can be the best in the world across all spheres of business from the primary sector to the most advanced computer design and augmented reality through to rockets.”.
From farm to rockets SMEs are everywhere and they need the support to be able to contribute to the International Trade sector as well. This event was INZBC’s effort in that direction.