Monthly Archives May 2009

Response to Budget

May 30, 2009 New Zealand FinanceNew Zealand Taxation  No comments

John Key’s New Zealand Budget has met with some hostile responses in Parliament.

While opposition is expected to any budget announcement, this year’s has seen a significant amount of vehemence. Labour Party Leader Phil Goff has been one of the key figures in the opposition to the budget announcement.

The two key points that Phil Goff has been opposing is the “deferral” of the personal tax cuts and suspension of superannuation payments. While the personal tax cuts are indefinitely deferred, Phil Goff was adamant that this means that they are never to be seen. He also suspects that while the Superannuation has been suspended officially for at least one year, it will be almost a decade before payments will be seen again.

Phil Goff voiced concern about the effect that these suspension...

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NZ Budget Released

May 28, 2009 New Zealand FinanceNew Zealand Taxation  No comments

New Zealand Prime Minister John key delivered the new Budget, no great surprises were present.

The new Government’s first Budget has been released amongst poor economic conditions and threats of credit rating downgrades. No particular surprises were featured, that have not been circulating over the previous weeks.

The promised personal tax cuts for 2010 and 2011 have been deferred, with no set date. To some analyst this has suggested these cuts be in perpetual deference, as John Key has talked of working to build a government surplus over the coming 5 years.

The Kiwisaver mortgage diversion facility has also been withdrawn due to its compliance cost and participation numbers of only 600.

Automatic contributions to the New Zealand Superannuation Fund have been suspended, with future pay...

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Credit Rating Decision to Come Soon

May 27, 2009 New Zealand Finance  No comments

New Zealand Prime Minister John Key has stated that the decision regarding the possible downgrade of New Zealand’s credit rating could come as early as the 28th of May, Budget release day.

While no official indication has been given by credit rating agency Standard & Poor’s as to the timing or result of their credit rating decision, Prime Minister John Key has made optimistic statements both to the possible outcome and the time until its announcements.

Three Standard & Poor’s executives were in a meeting with John Key, in an opportunity for him to elaborate on New Zealand’s future economic plans. He said in a statement after the meeting, that the executives understand his plans, although he has no indication in regards to their credit rating decision.

Prime Minister John Key has co...

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Chance of NZ Credit Downgrade Slim

May 25, 2009 New Zealand FinanceNew Zealand Taxation  No comments

New Zealand Prime Minister John Key has said that he does not expect New Zealand’s credit to be downgraded after the release of the May 28th Budget.

Despite warnings earlier this year by credit rating agency Standard & Poor, John Key believes that New Zealand government has changed its economic track enough to ensure that no credit downgrade will occur.

As an indicator of economic stability and certainty, the credit rating has a direct effect in the cost of financing that New Zealand will face. It is therefore in the interest of all New Zealanders that the rating not drops. John Key said, in an interview on TV One show “Breakfast” that such a downgrade would see roughly 2% in interest rates.

John Key has stated previously that the new budget would be a slimmer one then seen previousl...

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