Good grief, after signalling a ‘new’ company tax policy focussed on making life easier for small business we find out that Andrew Little and the Labour party know three fifths of five eights of stuff all about existing systems and tax arrangements.
He launched a discussion document on the policy at a speech to the Hutt Valley Chamber of Commerce this morning.
“This proposal gives business owners the option to pay up to 100 per cent of their tax through regular withholding payments, at the rate they set themselves,” Mr Little said.
“Alongside this, I’m also announcing that we would be scrapping late penalties for provisional tax and increasing the threshold for when provisional tax applies, from $2500 to $5000.”
At present, provisional tax rules require a business to estimate, in advance, its taxable profits for the year and pay tax in three large instalments over the year.
“If they guess wrong, they can be faced with a big bill at the end of the year which can push a small business to the wall,” Mr Little said.
“Under Labour’s proposal, businesses will have the option of choosing to pay their tax through regular instalments at a rate they can adjust. This means businesses can align their payments to suit their circumstances. Read more »