The New Zealand Bankers’ Association welcomes the interim report of the Australian and New Zealand Productivity Commissions on closer economic relations and a single economic market, but notes that addressing the issue of double taxation of company income was an absolute ‘must do’.

“The interim report usefully addresses many of the remaining barriers to a single economic market. However, the most significant remaining issue – that of double taxation of company income – has not been adequately addressed and is a must do for the final report,” says New Zealand Bankers’ Association chief executive Kirk Hope.

“Considerable work has already been done on the issues relating to double taxation for businesses based in either Australia or New Zealand with substantial operations in the other country.”

“These issues have been the subject of discussion and debate for more than 20 years. The combined work of the Australian and New Zealand Productivity Commissions should be a catalyst for timely change as we move toward celebrating the 30th anniversary of CER.”

“Capital should be able to flow between New Zealand and Australia seamlessly without barriers. A free and open trans-Tasman capital market would provide a substantial net benefit to the overall trans-Tasman economy.”

Allowing mutual recognition would allow shareholders resident in one country to use credits for company tax paid in the other country to offset domestic taxes. This would prevent their dividends being taxed twice.

Treasury

As part of Money Week (2 – 8 September), the New Zealand Bankers’ Association is encouraging people to get financial advice on how best to manage their money.

“Getting advice about your finances and how best to meet your needs and aspirations is a good idea for everyone. It’s about making informed decisions to manage your debt, build your savings and make good investments.

“There’s a range of advice available, from free budgeting advice to professional investment advice, which can help you plan goals and get you where you want to go.

“A good start is to talk to your bank about whether your accounts are right for you. Banks are happy to talk about how their products and services best suit your individual circumstances,” says New Zealand Bankers’ Association chief executive Kirk Hope.

“It pays to be clear about the benefits and any associated risks of the financial products and services you’re using.”

The provision of financial advice is regulated by the Financial Advisers Act 2008. Under the law there are three types of advisers. Almost all retail banks are Qualifying Financial Entities (QFEs) and their advisers are qualified to talk to customers about basic products such as accounts and simple investment products. Registered Financial Advisers (RFAs) can also advise on those products. For advice on investments like KiwiSaver, managed funds and more complex products, you need to talk to an Authorised Financial Adviser (AFA).

All QFEs (the organisation, not the advisers who work for them), and all RFAs and AFAs need to be registered. To check if your adviser is registered, go to the Companies Office Financial Service Providers.

The week ahead is Money Week, and the banking industry is getting on board with a range of financial education activities. Mr Hope says banks are backing Money Week because they believe well-informed customers are better placed to make borrowing and investment decisions.