NZ budget 2024


30th May, 2024

What the 2024 New Zealand Budget means for you

New Zealand’s coalition Government has delivered its maiden Budget today, with its much-anticipated tax relief announcement forming the centrepiece of Finance Minister Nicola Willis’s first Budget, delivering $14.7 billion of tax cuts across the board.

Willis said the Budget delivered on key coalition promises, with Budget documents stating 1.9 million households would benefit from the tax relief package by an average of $30 a week.

A key part of the new tax policy was adjusting personal income tax brackets, with tax rates remaining the same while increasing some of the thresholds – the first time this has been revisited since 2010.

What NZ businesses wanted to see

Recent MYOB polling revealed the top policies local business leaders and decision-makers were hoping to see in the New Zealand Budget, with tax relief, upskilling support, and reducing regulatory red tape being 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 2024 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 — the backbone of the economy — the majority (49%) weren’t confident their business would benefit, while 46% were feeling confident and the remainder unsure.

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

Increased investment in healthcare (43%) came out on top, and Health NZ Te Whatu Ora is set to receive $16.68b in new funding over three Budgets.

Highlights in the Health package include over $3.4b over four years to fund HealthNZ hospital and specialist services and more than $2.1b for primary care, as well as community and public health.

The Government will also spend $1.77b over four years to support Pharmac’s funding programme.

Thirty percent of SMEs polled wanted to see increased investment in education (30%), and there has been more than $1b of funding allocated to this sector.

The largest investment is in school and kura property projects and maintenance, with almost $1.5b earmarked over four years. Over $190m will go to support early childhood subsidies for the next four years and $266m will be invested in tertiary and training subsidies.

In addition, business owners looking to grow their teams by taking on new apprentices will be pleased to see the extension of the Apprenticeship Boost scheme beyond 2024, with $65m set aside for the next four years.

Employers of second year apprentices will receive monthly payments of up to $500 until the end of this year, and from January 2025, first year apprentices in key industries will be eligible for the $500 per month subsidy.

Taking a closer look at other business-focused policies leaders of New Zealand’s SMEs would support, a company tax reduction was favoured by 52% of SMEs.

While there were no changes in company tax rates this year, the tax relief package offers some light assistance to Kiwi households battling cost of living increases.

  • The announced tax cuts mean households with children would benefit by $39 a week on average.
  • Anyone earning $78,100 or more a year will receive the maximum tax cut of $20.05 a week, or $1,043 a year.
  • A minimum wage worker could expect about $12.50 extra a week, while a superannuitant couple would take home just $4.50 a week extra between them.
  • The Independent Earner Tax Credit is also being expanded, with the upper eligibility limit increasing from $48,000 to $70,000, with amounts reducing from $66,000+ instead of $44,000+
NZ budget 2024

Workforce opportunities key for mid-market

Leaders of local mid-market businesses were more confident (68%) than SMEs that the New Zealand Budget would deliver benefits for their business, with a desire to see policies that supported and promoted a stronger workforce for the future.

Three of the top five policy announcements the mid-market most wanted to see in the Budget this year underscored this, with support for training and upskilling (42%) being the number one ask.

Business leaders were also eager to see changes to immigration policy settings, like automatic recognition of skilled migrants’ certification and experience (32%) and improving the immigration accreditation scheme (27%).

The Government is set to change the way visa and immigration services are paid for, moving away from a taxpayer-subsidised model and upping fees to fully recover the costs. This will net $533m over the forecast period.

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%).

Key infrastructure investments announced in the Budget, including programmes already in delivery, should assist businesses with ensuring a smoother provision of goods and services around the country:

  • $1.2b for the Regional Infrastructure Fund will support regional economies to grow. On top of initial investment of $200m into flood resilience infrastructure, this Fund includes a focus on ‘enabling infrastructure’ which supports regional growth and connectivity e.g. projects that deliver benefits to multiple local businesses or parts of a community, and boost productivity.
  • $2.68b in roads, rail, and public transport to unlock economic growth, including 17 new Roads of National Significance and funding for the Rail Network Investment Programme. Budget 2024 boosts the Land Transport Fund with an additional $1b in capital funding, over that previously signalled, to accelerate construction of the Roads of National Significance.

Lastly, for retailers — a sector that has been plagued by the rise of ram raids and crime in recent years — an investment into strengthening law and order will be welcome news.

$2.1b has been allocated, with a focus on strengthening police presence on the frontline — funding training and retention for 500 new police officers, in addition to expanding prison capacity and establishing new youth offending programmes.

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.

Information provided in this article is of a general nature and does not consider your personal situation. It does not constitute legal, financial, or other professional advice and should not be relied upon as a statement of law, policy or advice. You should consider whether this information is appropriate to your needs and, if necessary, seek independent advice. This information is only accurate at the time of publication. Although every effort has been made to verify the accuracy of the information contained on this webpage, MYOB disclaims, to the extent permitted by law, all liability for the information contained on this webpage or any loss or damage suffered by any person directly or indirectly through relying on this information.