New Zealand Labor Unveils $1.56 Billion Small Business Package — With a Significant Trade-Off at Its Core

By Kekeletso Nkele, small.news Assistant

(small.news) — New Zealand’s Labor Party has released a small business policy package — costed at $1.56 billion over four years — as part of its 2026 general election platform, reports Business Desk.

The package contains three main proposals: lifting the instant asset write-off threshold, raising the GST registration threshold, and requiring large businesses to pay small suppliers faster. Labor small business spokesperson Dan Rosewarne said the measures were intended to ease cash flow and reduce compliance burdens for the country’s roughly 600,000 small businesses.

The Three Proposals

The package would lift the asset tax write-off threshold from $1,000 to $10,000 for businesses with annual turnover under $10 million, require large businesses to pay small suppliers within 15 days on invoices of $25,000 or less, and to publicly report their payment times, and raise the GST registration threshold from $60,000 to $80,000 — meaning around 35,000 of the smallest operators would no longer be required to register for GST.

What Experts and Business Groups Said

The individual measures attracted broadly positive responses from tax professionals and business organizations, though several attached caveats.

John Cuthbertson, head of tax at Chartered Accountants Australia New Zealand, said the proposals were good news for small business and that the GST threshold change in particular would encourage people to engage more fully in the market.

Deloitte GST expert Alan Bullot told RNZ that New Zealand sits in the middle of the pack internationally at the current $60,000 threshold, and that if the threshold had kept pace with wage inflation it would be closer to $130,000. He said a higher threshold would mostly help people earning through their own labor.

MYOB chief executive Paul Robson also welcomed the asset write-off proposal, noting that the MYOB Business Monitor had shown clear and sustained appetite among SMEs for a permanent increase to the instant asset write-off over the past two years.

BusinessNZ chief executive Katherine Rich welcomed the announcement and said several measures reflected long-standing BusinessNZ positions, describing the package as having real substance.

The Trade-Off That Divided Opinion

The most contested aspect of the announcement is how Labor proposes to fund the package. To pay for the $1.56 billion cost over four years, Labor plans to scrap the Investment Boost accelerated depreciation policy, which the current government announced in Budget 2025.

That trade-off drew strong criticism from BusinessNZ. Rich said redirecting the broad-based Investment Boost incentive into a narrower scheme for businesses under $10 million turnover would strip billions of dollars of investment that larger employers, exporters, and manufacturers would otherwise have made. She noted that larger businesses account for the bulk of New Zealand’s capital investment, and that it is precisely that investment in plant, technology, and equipment that lifts productivity and wages across the whole economy, including for the small businesses that ssupply or work alongside larger firms.

BusinessNZ’s stated position is that support for small business investment is warranted, but not at the expense of a proven, broad-based productivity policy. Any replacement for Investment Boost, the organization said, must remain available to businesses of all sizes.

Labor’s Framing

Labor has framed the package as targeting the segment of the business community it says has been overlooked. Rosewarne said running a small business should mean building something of your own, not spending evenings chasing overdue invoices and filling in forms, and that the proposals were simple, easy measures to keep New Zealand’s economy moving.

The party has not yet detailed how it would administer the prompt payment requirement for large businesses or what penalties, if any, would apply for non-compliance.

Context: An Election-Year Announcement

The package was released as part of Labor’s broader 2026 election platform, which also includes a targeted capital gains tax on investment property profits, free GP visits, and a public transport fare cap. The small business proposals are contingent on Labor winning the general election and would not take effect under the current government.

The current National-led government has not yet responded publicly to the specific proposals.