Lower company tax for small businesses to 20%

New Zealand First says it will lower the company tax for small businesses from 28% to 20%.

The party says the tax break, which will cost $1 billion in its first year of implementation, will apply to companies with a turnover of less than $30 million.

“Corporate taxes can reduce productivity, particularly in entrepreneurial and innovative sectors.  Lower company tax rates can improve long-run productivity growth, and stimulate the creation of new companies,” it said.

“A lower tax rate leaves additional cash available for reinvestment and reduces reliance on bank debt.”

It said any cost “will be more than covered in the medium term by more companies collectively paying a lower tax rate, higher employment, a growing economy, and more spending”.