How does NZ's tax payment system compare to the rest of the world?

Cashmanager | 2 years ago

Even the most forward-thinking and service-driven companies will find it difficult to excel if the legal policies and procedures surrounding their operations are overly stifling. Of course, a certain amount of red tape is necessary to ensure enterprises are functioning legally and ethically, but when compliance becomes unnecessarily convoluted it can be detrimental to a company's success.

How easy is it to pay taxes in New Zealand?

Thankfully, in regards to the country's tax system, this isn't too much of a problem here in New Zealand. In fact, recent research from PricewaterhouseCoopers (PwC) has found that our tax payment process is the 22nd easiest in the world - the same placing we earned in 2014. This puts New Zealand well ahead of Australia (rank 42) and the United States (rank 53), but slightly behind the United Kingdom (rank 15).

Why is it so important that we maintain our strong position in these rankings? As Geof Nightingale, Tax and Private Business Leader at PwC explained, it's critical in order for local businesses to remain competitive on the global stage. 

"New Zealand wants to compete on the world stage and in the global economy, so our own systems and processes must continue to be world-leading. Transforming New Zealand's tax administration system will be crucial to ensuring we remain a country that is easy for businesses to operate in and pay tax," he surmised.

Mr Nightingale also explained that New Zealand could climb even higher in the rankings in years to come.

"Inland Revenue's (IR) business transformation project will be key to making paying taxes easier in the future and is on the right trajectory, remaining a key priority for IR," said Mr Nightingale.

Leveraging tax management solutions to save time

Despite the country's relatively strong rankings, there's no denying that finance management can still be a time-consuming chore for many businesses. Making use of small business software such as CashManager from Accomplish could help you streamline the administration work involved with taxes, ensure you're complying with the applicable regulations and ultimately give you more time to focus on other aspects of the business.