November 7, 2016 9:00am by David Farrar

Businesses not keen on Robbo’s tax

Small companies could suffer under a Labour Party proposal to tax employers who are not providing training, Business New Zealand says.

But Business New Zealand chief executive Kirk Hope said many employers couldn’t get local staff in the first place, whether skilled or unskilled, and so couldn’t train them.

“So the problem with the policy is that it’s a fairly blunt instrument and it wouldn’t go anywhere near addressing what is a fairly complex problem.”

Mr Hope said small businesses also might not have the capacity to deliver training.

“If you think about a small- to medium-sized business that can’t get the skills that it needs to grow it will then also be negatively affected by being taxed so that’s not really a helpful solution to what is a growing problem.

“Given there are around 500,000 businesses in New Zealand, and only 2000 of them have 100 or more employees, it would be far better to provide some form training subsidy to the small to medium enterprises to help them access industry training and organisations to provide the training and capability building that we need.”

Effectively this will be a tax on small businesses. Large businesses will be fine, but small businesses will be whacked with Robbo’s tax.

A recent survey showed only 10% of small business owners backed Labour. I suspect that number is going to shrink even further.