Business Owners in NZ

[Kool Parts]

Hello to the world down under
This forum has so many subs that I haven't even noticed this one until today. So this question is for business owners in New Zealand. What is it like? Does the gov tax, or regulate you to death..Or are they proactive trying to help business? Maybe just stay out of the way?
How difficult / costly is it to export products?
We have undertaken a year long search for a more tax / business friendly area here in the states. Had it narrowed down to 2 states...and finally purchased land this fall. But the last few months really have me rethinking strategy.
My feeling is within the next few years the small business will be taxed out of existence.
We had originally considered several other country's to start with...but not OZ. Upon further inspection I like your weather, and we speak the same language...almost
So bring it on..the good..bad...and the ugly.
Gary

[Josywales]

Hi Kool Parts
Well to tell the truth we don't get any Government help and taxes are quite high. Yes the weather is great depending on where you are, north island for the sun and south for the snow. Labour is out for the next 3 years so hope with National we get some tax relief and an ease up in red tape. Otherwise a great country to live in. Get to beat the Aussies at rugby and they get to humilate us at everything else.

[Geof]

Originally Posted by Kool Parts ....Upon further inspection I like your weather, and we speak the same language...almost So bring it on..the good..bad...and the ugly. Gary

New Zealand???

Do you know how far away it is?

Do you know how small it is, especially when you are flying in and from 35,000 feet you see this pair of skinny islands that hardly seem large enough to take an airport.

I grew up in NZ and did all my trade stuff there, moved to Canada in 1966 and except for a brief moment of aberration in 1971 never considered moving back.

Why you might ask?

It is small so it is not easy to establish a really good business serving just the domestic market.

It is far away so if you plan on getting into export you had better be looking at something that is lightweight and high value so you can use airfreight; think Kiwi fruits or electronic equipment. One of the world's major supplier of special equipment for people who are blind or vision impaired is based in N.Z. near Christchurch; they have been so successful they took over their U.S. based competition.

The government there is not really 'business friendly'; at least not in the same manner as in the U.S., or even Canada. I realise this opinion may not be shared by Kiwis but in my experience if you look at the difference in 'business friendliness' between the U.S. and Canada you can kinda expect a similar degree of difference between Canada and New Zealand.

By 'business friendliness' I mean corporate tax rates, govt regulations and all the nonsense you have to put up with from politicos and liberal types who view businesses as milch cows that can be bled for tax dollars.

Mind you, I suppose these days the U.S. is probably catching up in that area.

One thing about being able to set up a successful export business in N.Z. is that the $NZ is down close to $US0.52; so if your are an exporter you can have a good income in N.Z. currency. The flip side is that nearly all your equipment and your material and tooling are imported so in $NZ they cost more than twice as much as in North America.

Also, and this is bound to ruffle some feathers among the Kiwis, it is difficult to get employees with a real go-getter attitude. Life in New Zealand can be very comfortable and very pleasant but to some extent they subscribe to 'Tall Poppy Syndrome'.

Not that I want to be discouraging.

But why not consider Canada?

[Kool Parts]

Have to admit I haven't given much thought to Canada. Over the years I have heard a common theme from customers in Canada...too much gov and taxes. But to be fair that was just said in passing not hard research on my part. Also probably everyone of them wasn't a business owner. Most people have no idea what happens on the other side of the counter.
Plus I was kind of looking forward to a summer longer than a week. Love the looks of all those warm beaches..laying around drinking...naked women...
What were we talking about? :
Gary

[Geof]

Originally Posted by Kool Parts ...Over the years I have heard a common theme from customers in Canada...too much gov and taxes.... ...Plus I was kind of looking forward to a summer longer than a week. Love the looks of all those warm beaches..laying around drinking...Gary

Too much govt and taxes is a common theme, and often correct. However, if you can stomach 'socialized medicine' and combine both your tax cost and medical insurance cost into one sum Canada is probably cheaper. Unfortunately to benefit from the Canadian medical system without enduring a long waiting time you have to develop a life threatening condition but when that is the case at least it doesn't drive you into bankruptcy.


Come on now the summer is at least two weeks which is a twofold improvement on your pessimistic attitude. You can also sit around a hot fire drinking and if you have your own business you don't have time or money for entertaining wimmen naked or not.

[Kool Parts]

have your own business you don't have time or money for entertaining wimmen naked or not.

No truer words ever spoken

Also thanks Josywales for the input. You stated "taxes are quite high" Please elaborate. Is there a particular tax that affects your business?
The one in my state that gets me the most is personal property tax. That one is a real sob as I get to pay tax on..chairs..desks...software..computers..end wrench..tool box..and of course the machines.....and wait....I get the privilege of paying this tax every single year.

I have been in contact with several NZ agency's and I don't think you have that one. Taxes are on thing but another way to hamper business is with over regulation. NZ seems to rank the best at not making you jump though hoops. But always good to hear from actual business.
Thanks,
Gary

[Dougal]

It depends who are are and what you plan to sell. I also think Geof's impressions from the 60's and 70's are quite outdated.

Like any business you pay tax on profit, so taxing them out of existance is quite difficult for a government, but taxing them out of profitability not difficult at all. Company tax rate is around 30% I think.

We have GST (goods and services tax or government sponsored theft) of 12.5% on everything sold here. If you're a GST registered business you claim it back on everything you buy and charge it on everything you sell. Similar systems exist worldwide.
If you're selling something like cigarettes or alcohol then expect some massive levy/tax on top of that, but items like that are the exception.

You didn't mention what type of business. That makes a huge difference. In the extreme case a countries laws may make your business either redundant or obselete.

Some govt departments have big teeth. In particular MAF (ministry of Agriculture and Fisheries, or something, had a name change recently) if you're involved with import/export of anything living and OSH (occupational safety and health). We see plenty of US TV showing people welding by brail and grinding without safety glasses. If the right ( wrong ) OSH inspector sees that then you can expect to be fined heavily and even shut down until problems are fixed.

[Jason3]

Originally Posted by Kool Parts The one in my state that gets me the most is personal property tax. That one is a real sob as I get to pay tax on..chairs..desks...software..computers..end wrench..tool box..and of course the machines.....and wait....I get the privilege of paying this tax every single year. Gary

On the contrary, I gather company assets can be depreciated and the depreciation offset against income for tax purposes...

New Zealand really has moved on since Geof was here, I think.

Best regards,

Jason

[Fantail]

Hey guys I'm going to throw in my 2 cents worth on the subject.
Like Geof I was raised in NZ and did my apprenticeship there (fitting, turning, machining/plastic injection mould making) and now live in Canada. I follow the news of what goes on in the country and from what I read there is no way I'd be moving there.

A few of my friends have businesses there and are always crying about the lack of good workers. I'm not talking about mum and pop shops either I mean companies that have sales in the $3-10 million range. Sure as a business owner you work harder than anyone else and expect staff to do their fair share but be prepared to hire people with a don't give a rip attitude. Geof is quite right when he says "it is difficult to get employees with a real go-getter attitude". Most of them left for a better life in other parts of the world. Take a look at how many have left in the last 6-12 months and how many came into NZ. You might also want to check out how many big companies (Fisher & Paykle is a good example) are closing their plants and moving to Asia to manufacture as it's way too expensive to operate in NZ.

Yes the country is nice, and the dollar is low right now, however look at the overall picture and do some home work on why it's hard to get good workers. Like Geof I know some of what I've written will upset some of the Kiwis but they have to remember all the info I get comes directly from them.
What ever you decide I wish you all the best in your endvours to find that perfect place.
Ken

[Dougal]

Originally Posted by Fantail Hey guys I'm going to throw in my 2 cents worth on the subject. Like Geof I was raised in NZ and did my apprenticeship there (fitting, turning, machining/plastic injection mould making) and now live in Canada. I follow the news of what goes on in the country and from what I read there is no way I'd be moving there. A few of my friends have businesses there and are always crying about the lack of good workers. I'm not talking about mum and pop shops either I mean companies that have sales in the $3-10 million range. Sure as a business owner you work harder than anyone else and expect staff to do their fair share but be prepared to hire people with a don't give a rip attitude. Geof is quite right when he says "it is difficult to get employees with a real go-getter attitude". Most of them left for a better life in other parts of the world. Take a look at how many have left in the last 6-12 months and how many came into NZ. You might also want to check out how many big companies (Fisher & Paykle is a good example) are closing their plants and moving to Asia to manufacture as it's way too expensive to operate in NZ. Yes the country is nice, and the dollar is low right now, however look at the overall picture and do some home work on why it's hard to get good workers. Like Geof I know some of what I've written will upset some of the Kiwis but they have to remember all the info I get comes directly from them. What ever you decide I wish you all the best in your endvours to find that perfect place. Ken

So when did you last live here?

Fisher and Paykel have many problems unrelated to where their stuff is assembled. I don't own any of their products, none of my friends and family do either because they haven't kept up with their competitors. They don't even offer a front loader washing machine and the build quality of their fridges is terrible.

We've had very low unemployment for the last few years, as a result businesses with a reputation for not treating staff well find it very difficult to get anyone to work for them. Those looking for special skills (i.e. engineers) can join a waiting list and wait for the engineers to come and interview them.

[Kool Parts]

Thanks for all the input guys Its always great to hear from people actually there. We are bogged down in a bear of a winter right now, plus the business is about to go into major change. So we will hunker down and keep collecting information for the near future
Gary

[Fantail]

Christmas has come and gone, the snow has stopped...finally, and I'm over the nasty flu going around up here. That means ....... time to reply to Dougals question.

So when did you last live here?

Many Many years ago, however I did state that all the news I get comes straight from New Zealand. (NZ Herald on line is one source www.nzherald.co.nz) So although I am not there in the thick of it I get a pretty good idea of the state of the country from what I read and what family and friends tell me. Also each time I come back "home?", which is every 3-5 years, I see first hand what is going on.
Don't get me wrong here, I love NZ but not enough to return to it to do business.

Most places in the world have had very low unemployment over the last few years, including NZ, Aust, and Canada. No matter what the unemployment level is like if a business treats their employees badly they will find it hard to get staff. Word gets around. My comment about finding good staff in NZ wasn't based on business treating staff badly as the people and companies I was thinking of actually treat their staff very well.
Anyway no matter what any of us have to say either positive or negative, someone will always take offense even when none is meant. I'm sure that Kool Parts will come to his own conclusions with or without my comments or Geof's.

Ken