COVID-19 Economic Recovery Plan Approved In Budget 2020

On Tuesday, the Government’s economic rebuild and recovery plan was approved in the Budget 2020.

Finance Minister Grant Robertson said that while COVID-19 has required significant Government investment to protect businesses and jobs, New Zealand is in a good position economically to cushion the blow.

New Zealand recently modified its R&D tax incentive to allow for refundability of tax credits starting from the 2020-21 FY. It has also increased the credit to 15 percent for money invested in eligible R&D.

The Budget 2020 will invest in the following:

• $3 billion worth of business tax refunds;
• Supporting businesses to invest in R&D;
• Up to $5,000 for professional business advice for SMEs;
• The Small Business Cashflow Loan Scheme;
• Supporting decarbonisation through investments to improve energy use.

Even after these investments, the New Zealand Government’s peak net debt position will be significantly lower than many other countries.