The hot topic over the last month has been the release of the fiscal budget and while this is not a political forum it is worth looking at some of the key initiatives because Chamber members, employees, and the local Wanganui community all are affected in some shape or form. The live television budget speech from Dr Michael Cullen and the reply from the John Keys was quite an entertaining session, things have definitely changed since the budget was announced at night when my parents used this as an great excuse for a night out with their best friends.

$10.6 billion is to be released in tax cuts over four years starting on 1st October. Various income tax scales have also changed:
• the lowest tax rate has been reduced to 12.50%;
• the 33% tax threshold increases by $4,500 to $42,500;
• the 39% tax threshold increases by $20,000 to $80,000.

While not material by any means, from 1st October 2008, (between $12-$28 less tax for the average person in October of this year), at least we have moved on from chewing gum savings to a block of cheese, unless that has been the effect of inflation over this time? By 2011 these tax savings have been estimated at between $1,130 and $2,870 every year, which is more encouraging. It will be interesting to see if these changes will be implemented, especially given the uncertainty of an election result later this year. Will New Zealander’s see the full effect of these proposals?

Superannuitants and beneficiaries also gain. Married superannuitants receive an extra $45 per fortnight and single superannuitants $24. Working for Families and beneficiaries will see an increase in just over 5% from 1st October instead of the planned 1st April 2009.
There are various other initiatives which are aiming to reduce compliance costs for SME businesses, such as increasing the threshold for monthly filing and payment threshold for PAYE from $100,000 to $250,000.

While there are many other initiatives, all in all, the general feeling is a lot of New Zealanders would have liked to have seen income tax cuts sooner rather than later given current high petrol costs and food bills. However, one of the main issues in stimulating the economy with these tax cuts is at the same time trying to keep a lid on inflation, which currently at 3.4% is higher than Reserve Bank guidelines.

This month is the launch of the ABN AMRO Craigs 2008 Wanganui Business Awards. The objective is to reward local business excellence and their contribution towards the economic development and growth of our region. “Quality Safety” won the Supreme Business Award last year, did you know this company won the Ministry of Health contract to manufacture 20 million face masks in anticipation of the SARS epidemic outbreak? This Wanganui business is one of New Zealand’s leading safety companies, and based on positive feedback from the awards they are soon to open a local Safety retail store. Quality & Safety has received the recognition they deserve through our local Business Awards.

Entries to the 2008 business awards close on 29th August, there is enough time to enter and the entry process has been made easier.

Winter is upon us, we’ve had a sensational summer. Take another walk up one of New Zealand’s most beautiful and historical main streets. Soak up the view to the Sargeant Art Gallery, it is world class. Make sure you visit the Te Pihi Mata exhibition at the Whanganui Museum before it ends in September. Support local business, we all benefit in the long run. Keep fit and healthy over winter.

Wanganui, it definitely is right here on our doorstep.
Simon Cairncross
Councillor