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NZ Ranks 22nd In New 'Paying Taxes' Report

by Mary Swire, Tax-News.com, Hong Kong

28 November 2014


New Zealand's tax regime is among the world's simplest for businesses to comply with, PwC and the World Bank Group's latest Paying Taxes Report says.

The report assesses the average time required for a company to prepare and file tax returns and pay its taxes. It also takes into account the number of taxes payments required, the method of payment, and the the company's total tax liability as a percentage of its commercial profits.

New Zealand rose one place, from 23rd in last year's study. It ranked behind Singapore, in 5th, and the UK, in 16th. However, it was ahead of most other major trading partners, including Australia (39th), the US (47th), China (120th), and Japan (122nd)

The total tax rate for New Zealand companies stands at 34.4 percent, according to the report. This is slightly lower than the 36.3 percent average for the Asia Pacific region.

On average, companies in New Zealand spend 152 hours to achieve tax compliance, compared with a regional average of 229 hours. Companies in New Zealand make an average of eight payments, compared with a regional average of 25.4.

PwC's Tax and Private Business Leader, Geof Nightingale, said: "New Zealand's 22nd placing out of 189 shows we have coherent tax policy settings, with no immediate or radical shifts in policy required for our country. However, there is little risk of New Zealand becoming complacent. Inland Revenue's (IR's) briefing to its returning Todd McClay last week made it clear IR's Business Transformation Project is a key priority."

"As we look to our major trading partners, the easier and less costly for a company to pay tax here, the more likely this will encourage and help to attract both domestic and international investment to our economy," Nightingale said.

"We expect Paying Taxes 2015 to be a catalyst for some interesting debate with tax authorities, Governments, and business around tax systems and how they can be reformed, providing illustrations of successful reforms and also where reform has been more of a challenge," he concluded.

TAGS: compliance | Asia Pacific | tax | investment | business | tax compliance | interest | corporation tax | Australia | China | Singapore | New Zealand | Japan | Tax

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