The Prime Minister announced a business tax package today, which includes proposals to simplify business tax.
All businesses benefit from an environment which gives them confidence to invest and grow. Through the Business Growth Agenda, the Government is working to create a competitive and productive economic environment which supports both export and domestically focused businesses. One way Government can help businesses is by reducing their compliance costs, saving them time and providing more opportunities to run and grow their businesses.
Inland Revenue’s Business Transformation programme is part of the Government’s investment in a productive environment for businesses. A well-functioning, modern revenue system should make it easy for businesses to get things right and difficult to get wrong, and reduce compliance costs.
Research shows that tax compliance costs are relatively high for small businesses. It is important to consistently ask whether these costs are excessive. In particular, for small businesses, there is the question of whether ‘close enough is good enough’ and whether there are ways of reducing compliance costs without providing tax concessions. Of course it is important, where possible, to reduce compliance costs for all businesses.