Labour doubles down on New Zealand’s productivity crisis

Taxpayers’ Union is slamming Labour’s plan to axe Investment Boost, warning it would discourage business investment and make New Zealand’s productivity crisis even worse.

Taxpayers’ Union spokesman James Ross said:

“New Zealand’s stagnant productivity is the rot behind our squeezed wages, weak growth, and increasingly unaffordable superannuation, healthcare, and other public services.”

“Labour productivity growth has averaged barely 0.2 percent a year since 2019. Businesses cannot boom when governments make it more costly to invest in machinery, tools, and technology.”

“Before Investment Boost, New Zealand had the second-worst capital-recovery settings in the OECD. When businesses have to wait years to deduct the full cost of an investment, the country become less attractive and capital goes elsewhere. That’s what Labour want to take us back to.”

“Investment Boost was never ambitious enough, but Labour are moving in exactly the wrong direction by punishing companies for investing in themselves.”

“Full capital expensing is the single best bang-for-buck productivity boost. Scrapping even a partial version is madness.”

The Taxpayers' Union's report 'Going for Growth: Full Capital Expensing' can be found at www.taxpayers.org.nz/full_expensing_mr