TaxBlog

The National Government has moved to enact it’s five pronged attack to help small business.

The five key measures annouced are:

1. Tax changes,
2. Expanding the jurisdiction of the disputes tribunal
3. Expanding the role of the Export Credit Office,
4. Expanding business advice services, and
5. Creating a fast-payment requirement for government agencies.

See our coverage of numbers 2 -5 below:

Key has directed Government departments to pay bills promptly

State Services Minister Tony Ryall has announced that government departments have been directed to make sure they pay their bills on time, or earlier, especially invoices from small and medium-sized business suppliers.

The Government has told the State Services Commissioner Iain Rennie it expects all departments to urgently review their process for approving and paying invoices to their suppliers, and to bring forward payment dates where possible.

Government agencies are to, at a minimum, pay their invoices in accordance with their posted terms and conditions, and in any event, no later than the 20th of the month following the receipt of the invoice.

“Government agencies are substantial customers for many small to medium sized businesses. By ensuring these agencies pay their bills on time or earlier, we can help with business cashflow.

Changes to the disputes tribunal:

“Currently, the maximum claim level of the Disputes Tribunal is $7,500, or $12,000 with the consent of both parties. To make life easier and cheaper for small businesses, the Government will lift those levels to $15,000 and $20,000.

“This change will reduce costs in up to 3,600 cases a year which will now be able to be held in the Disputes Tribunal. Previously these cases would have been held in the district court and many would not have been pursued due to the costs involved.

“This is designed simply to lighten the load on small and medium-size business so they can get on with the business of producing goods and services.”

Free Advice service for businesses has been expanded:

The assistance includes a rejuvenated Biz 0800 hotline, free business health checks, and a free mentoring service.

The advice can extend from dealing with cash flow, to management strategies, the best ways of trading through an economic downturn, and how to maximise the advantages from the range of other government initiatives announced today.

“Many of these services have been available previously in some form, but they will be of greater value now if a small business operator comes under stress,” Mr Brownlee says.

The last change relates to trade credits:

“The global financial and economic downturn has affected the availability of short-term trade credit in New Zealand, making it very difficult for some exporters - particularly small-to-medium exporters - to continue trading in some countries,” says Mr Groser.

“These new measures will help to ensure trade opportunities won’t be missed - which is crucial in the current economic environment.”

NZECO has previously provided trade credit insurance only for contracts with payment terms of more than 360 days. This will be extended to include periods of fewer than 360 days.

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