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Inland Revenue

Tax Policy

PUBLISHED 7 November 2002

Consultation begins on tax compliance costs

The tax-related compliance costs of smaller businesses are the focus of wide-ranging consultation with businesses that begins this month. Inland Revenue has organised a series of events for hearing the views of small and medium-sized businesses about the tax compliance cost problems that concern them most. They include visits to businesses, a nationwide series of focus groups, a telephone survey of over 2000 business people and tax agents, and a survey on Inland Revenue's website in which anyone can take part. For more information, see the government's media statement and Inland Revenue's media statement.

Hon Paul Swain
Associate Minister of Revenue


Tax officials get alongside small business-people

Senior Inland Revenue Department officials will visit small to medium-sized business operators around New Zealand to hear their views on how to simplify the tax system, Associate Minister of Revenue Paul Swain announced this morning.

The visits are part of a major consultation excercise aimed at reducing tax-related compliance costs for small to medium-sized businesses and are an important part of the government's small and medium-enterprise strategy.

"The government is keen for IRD officials to get alongside small business owners to get an idea of the impact of policies at a practical level," said Mr Swain. "To do this we need to hear from businesses themselves about the complications and costs the tax system imposes on them, and their views on possible solutions.

"The idea of sending tax officials out to visit small businesses was first suggested by Revenue Minister Michael Cullen after the election," said Mr Swain. "It came out of discussions myself and Dr Cullen had with small business people."

There will be 30 visits, which will be completed by the middle of next month. The visits will be targeted at businesses in the regions which have been established in the last few years. "We want to talk to new small businesses to get an idea of the different compliance costs which businesses face as they grow," said Mr Swain.

As well as the visits the consultation exercise will involve collecting the views of small and medium-sized business people in three other ways:

  • A series of 15 focus groups, run by an independent research company, in cities and towns around the country. The first focus group was held in Napier on 31 October.
  • A telephone survey, conducted during December, of more than 2000 small to medium-sized businesses and tax agents.
  • A web site where taxpayers not consulted in the visits, focus groups or telephone survey can submit their views. This survey is open to anyone who wants to participate and is available from today at

"The information that's gathered in the consultation will be fed into Inland Revenue's Small and Medium-sized Enterprise Project," said Mr Swain. "It will form the basis of a discussion document, scheduled for release in the middle of next year.

"This consultation is part of the government's SME Strategy, which is being driven by a team of ministers comprising Finance Minister Michael Cullen, Regional Development Minister Jim Anderton, Commerce Minister Lianne Dalziel, Associate Commerce Minister John Tamihere and myself.

"It follows on from the More Time For Business discussion document and the recommendations of the Ministerial Panel on Compliance Costs and is part of an ongoing government programme to simplify the tax system and reduce business compliance costs.

"These are all practical activities whose purpose is to come up with real solutions to real problems that may be hindering the growth of New Zealand's many smaller businesses," said Mr Swain. "I appreciate the time that already busy business people will be asked to put into any one of these exercises, but their first-hand knowledge of the effect of tax compliance costs on their business is essential to finding a better way of doing things."

Andrew Janes - Press Sec for Paul Swain - 04 4719889/021 270 9106 or [email protected]
For other releases by Paul Swain:
For business information from the government: [site no longer available - see Internet Archive for archived version]

Inland Revenue Department


Inland Revenue seeking tangible solutions to meet Small to Medium Business needs

Inland Revenue's structured programme of interactive consultation with small to medium sized businesses (SME) is underway. The programme aims to build greater understanding of business needs, look into ways of simplifying the tax process and reducing tax-related compliance costs for SME.

This initiative is one part of a governmental cross-sector approach to reduce tax compliance costs, create more time for businesses to carry out their business and encourage business growth and innovation.

"The initiative represents a significant effort by Inland Revenue to ensure the voices of small to medium business are heard. We want to identify the problems specific to this taxpayer group and find solutions to those problems," said Bruce Thompson General Manager Service Delivery.

Over the coming two months this programme will involve a combination of focus groups, qualitative and quantitative research providing a rich source of information. There will be four streams of consultation:

  • 15 group discussions in larger centres with six to eight taxpayers representing customer groups such as GST registrants, larger employers, and small employers
  • 30 one-on-one visits to taxpayers in provincial and rural areas by Inland Revenue's small business advisory service staff and senior managers responsible for communicating with, and providing information to taxpayers
  • A telephone survey with 2100 SME taxpayers and agents
  • A website survey in which any SME taxpayer can take part.

"The extensive consultation we are undertaking with SME will allow a greater understanding of the things that concern those business operators the most and will present opportunities for tangible solutions that specifically meet the needs of that taxpayer group."

In addition Inland Revenue has a number of other activities in progress to support SME, both operational and policy. Some of the information gathered during consultation could be used to further develop these.

  • A review of Inland Revenue's advisory service for small business ensuring resources are targeted and cater for common business life cycle changes. As part of this the department will be reviewing products and tools currently provided to small businesses to ensure these meet their needs.
  • Greater opportunities for business customers to interact electronically. Inland Revenue has launched a five-year plan to develop and promote the use of electronic technology to simplify calculating and paying tax and to broaden the range of electronic services that it provides to taxpayers.
  • In the last year Inland Revenue has enhanced the information we provide and developed a series of interactive services for business customers through the department's web site -
  • Development of an Industry Partnership strategy where the department is working along side industry groups to find ways to make it easier for their members to meet their tax obligations and to increase tax compliance within those groups.
  • The government has enacted a number of tax simplification and compliance cost reduction initiatives, many designed to assist small businesses including:
    • Raising the turnover threshold for compulsory GST registration from $30,000 to $40,000
    • Reducing the rate of late payment penalties and interest
    • Introducing a staggered approach to the application of late payment penalties.


For further information contact:

Sian Routledge
Corporate Communications
Inland Revenue
Telephone - 04 498 5819
Mobile - 027 224 6438