Govt package recognises importance of cashflow

The Government’s small business relief package will directly help many firms’ cashflow problems says Business NZ.

Business NZ Chief Executive Phil O’Reilly says the decision to temporarily reduce provisional tax levels takes into account those who have made reduced profits over recent months and will give all firms a boost.

“Now more than ever, cash is king. Helping firms’ liquidity is a very practical approach.”

Mr O’Reilly said the GST, PAYE and FBT changes announced today would also lessen the tax compliance burden.

“Maintaining our export performance is also crucial during the current downturn and the temporary expansion of the Export Credit Scheme makes sense. Improving the lines of credit available to exporters will be very welcome.

“Some of the initiatives announced today may seem small scale, even boring, but they have clearly been designed with thought for the small business person and are appropriate if part of an overall response to the developing economic situation.

“We do have some concerns about the extension of the business advice service as part of the relief package however – whether in times of downturn or growth this is an activity that is always better delivered by the private sector and should not be crowded out by taxpayer funding.”