NZ Budget


28th May, 2024

Anticipating New Zealand Budget 2024: What do we know?

This Thursday (May 30), New Zealand’s Minister of Finance Nicola Willis will deliver her first Budget, providing the official costings behind the new coalition Government’s spending and revenue plans.

For many New Zealanders, the question top of mind is simply: how much relief will a tax cut offer up?

Ms Willis has said the planned tax relief will be aimed at middle and lower-income workers across the country, and that the cuts would increase the take-home pay of approximately 83% of New Zealanders over the age of 15, and 94% of households.

She also recently referenced the Government’s planned tax relief in this speech.

NZ budget 2024

Other pre-Budget announcements

While we’ll have to wait until 2pm on Thursday for the full reveal, the New Zealand Government has released some pre-Budget announcements, including (but not limited to):

  • $24m boost for Gumboot Friday over four years, to give more young New Zealanders better access to mental health services (for those aged between 5-25 years old)
  • The Roads of Regional Significance list was announced, intended to speed up the delivery of new highways. These projects will be funded by $6.5b already set aside
  • $63.6m (combined) for Coastguard and Surf Life Saving over four years, to keep people safe in and on the water
  • $140m to invest in 1,500 more social homes, using funds released by the end of the First Home Grant
  • $67m for mandatory structured literacy in schools
  • Current school lunches program Ka Ora, Ka Ako will continue with $478m in funding. This will cover an interim model for 2025/2026 while the program is fully redesigned
  • Nearly $53 million over four years to attract, train and retain teachers in New Zealand.
  • $571m for the Defence Force to improve pay for frontline and upgrade/replace equipment and facilities
  • $1.9b for Corrections over four years, including investment in more frontline corrections officers, extending prison capacity, frontline police recruitment, and extending rehabilitation programs

What NZ businesses want to see

Recent MYOB polling revealed the top policies local business owners and decision-makers are hoping to see in the New Zealand Budget, and tax relief, upskilling support, and reducing regulatory red tape are top of the list.

We surveyed owners and decision-makers from SMEs and mid-market businesses* across the country on their expectations and policy asks for the upcoming NZ Budget, as well as their confidence levels around whether this Budget would deliver some benefits for business.

NZ budget 2024

SME confidence mixed

For SMEs — often referred to as the engine room of the economy — the majority (49%) aren’t confident their business will benefit from announcements made on May 30th, while 46% are feeling confident and the remainder are unsure.

Confidence levels amongst SMEs may be mixed, but the priorities are clear — with a balance of broader societal benefits and business support shaping the top five policies SME decision-makers want to see this year.

Increased investment in healthcare (43%) comes out on top, followed by a reduction in the company tax rate to 25% (36%), increased investment in education (30%), increased investment in infrastructure (28%), and support for training and upskilling (27%).

NZ Budget 2024

MYOB CEO, Paul Robson, says that with SMEs sitting at the heart of communities across the country, it’s not surprising to see a strong call for policy that offers more support to those they serve.

“Regardless of industry or location, SMEs tend to have strong ties to their local community. The people they employ and their customers are often neighbours, friends, family and local connections — so it makes sense that investment in core areas that have broader benefits for society and secure New Zealand’s future, are high on the agenda,” he explains.

“Any business hopes or expectations around Budget outcomes will also be tempered by understanding the Government’s fiscal position, and balancing their needs with areas requiring urgent spend. However, investing in local business is critical to growing the economy and business owners are clear on some of the policy settings that could free them up to do just that.”

Taking a closer look at other business-focused policies leaders of New Zealand’s SMEs would support, next to a tax reduction to 25% — favoured by 52% of SMEs — initiatives that improve the ease of doing business and support growth are on the radar.

Forty-two percent of SME owners support policy that would simplify the tax filing process, while 36% want simplified and streamlined consent processes, 30% would support a set proportion of Government contracts being assigned to local SMEs, and more than a quarter would support lowering the R&D Tax Incentive spend threshold.

“Ultimately, local SMEs are looking for policies that address the costs impacting their bottom line, simplify complex processes that stifle growth, and create an environment that supports innovation and uplifts the potential of their teams,” says Paul.

NZ budget 2024

Maximising workforce opportunities key for mid-market

Leaders of local mid-market businesses are more confident (68%) than SMEs that the New Zealand Budget will deliver benefits for their business, and have their eyes firmly set on policy that supports and promotes a stronger workforce for the future.

Three of the top five policy announcements the mid-market would most like to see in the New Zealand Budget this year underscore this, with support for training and upskilling (42%) being the number one ask, with changes to immigration policy settings, like automatic recognition of skilled migrants’ certification and experience (32%) and improving the immigration accreditation scheme (27%), also featuring.

As well as recognising international certification for skilled migrants entering New Zealand, mid-market leaders also favour policy that delivers automatic approval of certified international materials and products, with nearly a third (31%) of those surveyed including this in their asks for 2024.

Despite often having deeper pockets than SMEs, rising costs are also putting pressure on mid-sized businesses and a reduction in the company tax rate to 25% is also on the wish list for just over a quarter (26%) mid-market decision-makers.

NZ Budget 2024

“The mid-market might represent a smaller segment of overall enterprises, but they are some of the most ambitious organisations in New Zealand,” says Paul.

“Local mid-sized businesses are consistently driving for growth, and whether they’re aiming to increase revenue, grow their presence in the market or outpace their competitors, policy that helps to deliver the resource and expertise they need could contribute significantly towards these goals.”

Looking beyond the priorities for this year’s Budget, mid-market business leaders were also polled on the priorities or initiatives they would like to see the coalition Government focus on during its three-year term.

Fast-tracking the digitisation of Government and public sector systems to improve the business-to-government engagement experience (34%) came out on top, followed by creating a 30-year plan for national infrastructure projects (24%), increasing international trade deals (24%), enhanced investment for R&D, innovation and commercialisation (23%), and investing in hi-tech infrastructure(23%).

“The focus for the mid-market in New Zealand is clear. Building and supporting a workforce that has the right skills and a business infrastructure that is fit for an innovative and dynamic economy — one more structurally suited to the challenges and opportunities of the future, and more strategically connected to the rest of the world to improve business outcomes,” adds Paul.

About the research

MYOB’s survey of SMEs (with fieldwork conducted by Dynata) comprises a nationally representative sample of 554 owners and senior decision makers in small to medium-sized businesses in New Zealand. The survey was conducted between March 13th – March 22nd 2024. Respondents were sampled randomly from the Dynata online panel and screened to ensure they met the qualifying criteria. Quotas were maintained on industry sector to ensure a reliable and diverse cross section of SME opinions were obtained.

MYOB’s survey of the mid-market (with fieldwork conducted by Dynata) comprises a nationally representative sample of 516 owners and senior decision makers in mid-sized businesses (*employing 20 – 500 FTEs, $5m+ annual revenue) in New Zealand. The survey was conducted between March 22nd – April 15th 2024. Respondents were sampled randomly from the Dynata online panel and screened to ensure they met the qualifying criteria. Quotas were maintained on industry sector to ensure a reliable and diverse cross section of mid-market opinions were obtained. Responses for the survey were weighted by industry and business size in line with Stats NZ counts.

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