Australian Budget a Wake-up Call

Australian Budget a Wake-up Call

“The Australian government’s moves towards a lower and flatter tax scale point to where New Zealand should be heading”, Rob McLeod, chairman of the New Zealand Business Roundtable, said today.

“They are in line with submissions by business organisations in New Zealand on the government’s review of business taxation.”

Mr McLeod said that Australia was making steady progress in successive budgets towards a better tax regime.

“The cuts to top tax rates and the extension of tax thresholds provide incentives to working Australians to get ahead, and strengthen Australia’s competitive position.

“The size of government as a proportion of the economy is lower in Australia than New Zealand, and most Australians face lower income tax rates than New Zealanders. For example, the 30 cent tax rate now applies to incomes up to NZ$90,000.

“Business taxation is also being reduced.

“New Zealand cannot ignore these moves by our main competitor for investment and skills”, Mr McLeod said.

“We actually need better policies than Australia, including lower taxes, in order to offset its other advantages, match its living standards and achieve our government’s goals for growth.”

10 May 2006

ENDS

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