Dear Editor,
The goods and services tax (GST) is a value-added tax that was introduced in New Zealand in 1986, currently levied at 15 percent. It is notable for exempting few items from the tax. From July 1989 to September 2010, GST was levied at 12.5 percent, and prior to that at 10 percent.
The New Zealand government posted a smaller operating deficit than expected in the first four months of the financial year as it reported a bigger personal tax take and reaped more from customs duties on imported tobacco.
Finance Minister Bill English said in a statement: "Although the economy is improving and revenue is increasing, there are a lot of other large influences on the government's books. These include a growing prominence of financial assets and liabilities, which expose taxpayers to greater volatility."
The government's residual cash deficit of $3.26 billion was smaller than the $3.42 billion forecast in May, with $1.26 billion raised from the sale of instalment receipts in Meridian Energy. Another $627.5 million is payable on May 15, 2015.
Net debt of $59.08 billion, or 27.8 percent of gross domestic product (GDP), was slightly lower than the $59.43 billion, or 27.9 percent of GDP, forecast. Gross debt of $82.89 billion, or 39 percent of GDP, was more than the $80.83 billion, or 38 percent of GDP, expected, due to more government bond issuance.
New Zealand has been named the world's second best country to do business in, behind only resurgent Ireland.
The survey found New Zealand had the best scores among all countries for personal freedom and investor protection, as well as lack of red tape and corruption.
The Forbes survey graded 145 nations based on 11 equally weighted factors - property rights, innovation, taxes, technology, corruption, freedom (personal, trade and monetary), red tape, investor protection and stock market performance.
The Bahamas fits none of the above 11 quality factors weighted, so why are we comparing our economy to their own with regards to VAT?
- Mr. Edwards
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