INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

New Zealand
Economy in Brief
Submitted By: Talha Arfi Registration # 20090498 Submitted to: Mr. Enver A Ferzan

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

Introduction:

Population:
4,290,347 (July 2011 est.). Population gr owth rate is 0.882% (2011 est.)

Area:
Total: 267,710 sq km

Political System:
Parliamentary democracy and a Commonwealth realm.

Literacy Rate:
Definition: Age16 and over can read and write Total population: 99% Male: 99% Female: 99%

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

A Note on Economy:
GDP:
Amount in USD
119.5 119 118.5 118 117.5 117 116.5 116 115.5 119.2 118.8

116.8

GDP (PPP) 2008 2009 2010

GDP Real Growth Rate:

Year (est.) 2010 2009 2008 Percentage 2.1 -1.7 -0.2

GDP- Composition by sector:

Agriculture, 4.60%

Industry, 24% Services, 71.40%

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN Per Capita Income:

Amount in USD
28600 28400 28200 28000 27800 27600 27400 28000

28500

27700

27200 Per capita Income

2008 2009 2010

Tax to GDP Ratio:

In %
32 31 30 29 28 27 26 25 24 26.8 29.6 31.1

2008

2009
% of GDP

2010

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN Main sources of revenue:

The government's main sources of revenue come from tax, levies, fees, investment income and from the sales of goods and services. Total core Crown revenue for the 2009/10 year was $56.2 billion. Tax revenue is the major source of core Crown revenue; this totaled $50.7 billion in the 2009/10 financial year.

$ million
Core Crown Tax Revenue Core Crown Other Revenue Core Crown Revenue Crown entities, SOEs and eliminations Total Crown Revenue

2008
56747 5072 61819 19660 81479

2009
54681 4801 59482 20024 79506

2010
50744 5472 56216 18509 74725

Other Revenue:
Other revenue includes other sovereign revenue (e.g, ACC levies), sales of goods and services (e.g, postal services), interest income and dividend income. Other revenue has reduced by $0.9 billion over the year to $24.0 billion.

Other Revenue
30 25 20 15 10 5 0 Billions of $

2006 20.5

2007 21

2008 24.9

2009 24.9

2010 24

Other Revenue

Billions of $

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

Exports & Imports:

Billions of $
35 30 25 20 15 10 5 0 2009 Exports Imports 2010 23.35 23.95 33.24 30.24

Export Commodities:
Dairy products, meat, wood and wood pr oducts, fish, machinery.

Import Commodities:
Machiner y and equipment, vehicles and aircraft, petroleum, electr onics, textiles, plastics.

Export & Import Partners:

Exports - Partners
25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 20.00% 15.00% 10.00% 5.00% 0.00%

Imports - Partners

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

Taxation System:
In New Zealand, personal tax years run from 1 April to 31 March.

Type of Taxes:
1. Tax on New Zealand Personal Pensions: Apart from the limited tax credit afforded by the KiwiSaver retirement savings scheme, Contributions to pension funds in New Zealand are not tax free. Income and lump sums residents take from New Zealand pension funds are regarded as "tax paid". 2. Tax on KiwiSaver: Individuals pay income tax on the portion of their salary that they contribute to your KiwiSaver scheme. Employees contribute either 2%, 4% or 8% of their gross earnings. From 1 April 2009, employers are required to contribute to their employee's Kiwisaver account at the minimum of 2% of the employee's gross salary or wage. 3. Accident Compensation Levies (ACC): All employees must pay an ACC earner's levy to cover the cost of non-work related injuries. Earner's levy is charged at a flat rate which may vary for each year. For the 2008/9 income year, the rate of ACC earner's levy is $1.40 per $100 for any earnings up to $102,922. For the 2009/10 income year, the rate is $1.70 per $100 for any earnings up to $106,473. For employees, the levies are collected by the employers and paid to the Inland Revenue Department as part of the PAYE payments. 4. Fringe Benefits Tax (FBT): FBT is payable by employers on benefits provided to employees. The rate is up to 61% of the taxable value of the benefit provided, effective from 1 April 2009. 5. Other Taxes on Individuals: Capital acquisitions tax A gift duty is levied on the donor on gifted assets worth more than NZD 27,000 in a 12 month period and a gift statement must be filed once the value of gifted assets in any 12-month period reaches NZD 12,000. Parliament is currently reviewing whether or not to repeal the gift duty. Capital duty No Stamp duty No Real property tax No Inheritance/estate tax No Net wealth/net worth tax No

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN

6. Goods and Services Tax (GST): GST is a value added tax introduced in New Zealand on October 1, 1986 at 10%. It later increased to 12.5% on July 1, 1989 and was further increased to 15% on October 1, 2010.End-users pay this tax on all liable goods and services directly, in that the purchase price of goods and services includes GST. Unlike most similar taxation regimes, there are few exemptions - all types of food are taxed at the same rate, for example. Exceptions include rents collected on residential rental properties, donations and financial services. Businesses exporting goods and services from New Zealand are entitled to "zero-rate" their products - effectively, they charge GST at zero percent. This permits the business to claim back the input GST but the eventual, non-New Zealand based consumer does not pay the tax (businesses that produce GST-exempt supplies are not able to claim back input GST.)

Types of taxable income:

Salary and wages Business and self-employed income Income from investments (interest, dividends etc.) Rental income Overseas income (including income from an overseas pension)

Rates:
Individuals: Individuals NZD 0 14,000 14,001 - 48,000 48,001 70,000 Over 70,001 Rate 10.5% 17.5% 30% 33% Individuals, including ACC earners levy NZD 0 14,000 14,001 - 48,000 48,001 70,000 Over 70,001 Rate 12.54% 19.54% 32.04% 35.04%

Companies: New Zealand corporate tax rate is a flat 30%, which also applies to branches. Corporate tax rate is decreasing to 28% as from 2012 income year. Complying Trusts: Income retained by the Trust is subject to the flat rate of 33%.Income distributed to beneficiaries (with 6 months of balance date) is taxed at the rates for the individual beneficiaries

INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN Amount and %:

Millions of $

Tax Revenue
60000 50000 Millions of $ 40000 30000

20000
10000 0 Individuals 2009 25859 24391 Corporate 9276 7200 Other 2637 1936 GST 11551 11917

Indirect Taxes 4822 4903

Total 54145 50347

2010

References Used:
Central Intelligence Agency. Retrieved from https://www.cia.gov/library/publications/the-worldfactbook/geos/nz.html Wikipedia. Retrieved from http://en.wikipedia.org/wiki/Goods_and_Services_Tax_(New_Zealand) Tax Rates. Retrieved from http://www.taxrates.cc/html/new-zealand-tax-rates.html Inland Revenue Department, New Zealand (Te Tari Taake).Retrieved from http://www.ird.govt.nz/