NZ First Wants 20 Percent Tax Rate for Smaller Companies
New Zealand First is campaigning on cutting the company tax rate to 20 percent for businesses with turnover under $30 million, according to RNZ.
The plan would cut the rate from 28 percent to 20 percent for firms below that threshold. The party puts the cost to the Government at $1 billion.
The party called the proposal a "much-needed bold step to encourage investment, expansion, productivity and employment".
Qualification turns on turnover — total sales before expenses — rather than legal structure alone or staff numbers. That gives Inland Revenue a $30 million cut-off to apply, and firms near that level will need to plan around it.
People who are self-employed are taxed as individuals, according to Inland Revenue. The company-rate change sits separately from the personal tax system that applies to sole traders.
For comparison, the average company tax rate across OECD countries is 24.2 percent, according to the Tax Foundation.
As background, New Zealand First's 2023 policies included a 20 percent tax for exporters on new business or product lines. The party published its 'Power to the People' State of the Nation address on 23 March 2026.
To put this in context, the party's wider record on tax has been interventionist and transactional.
The party has also called for cutting the price of cigarettes to $20. Leader Winston Peters said at the time the party intended to "stop punishing smokers with high excise tax". In August 2026, Peters questioned whether the National Party could stop a bed tax. In November 2024, as Deputy Prime Minister, Peters said the Government's tax cuts had failed to improve the economy and had instead masked its problems.
The broader context here is how a turnover-linked company rate would be negotiated and put in place under MMP, the voting system where parties usually need to work together to govern. The $1 billion figure invites scrutiny of the assumptions behind it, and the line between companies that qualify for 20 percent and unincorporated businesses on personal rates will be central to working out who is covered. Treasury and independent economists will test the first estimate of lost revenue against changes in behaviour, including incentives to incorporate, profit-shifting at the threshold, and any investment response. Officials will also look at grouping rules for related companies, anti-avoidance measures, and how firms that grow above $30 million are treated.
Looking at what this means for coalition politics, the policy works as both an economic offer and a negotiating marker. It differs from a general tax-relief position by targeting smaller companies and linking the cut to investment, expansion, productivity and employment. It sits alongside earlier calls for targeted relief, from exporters to smokers, and scepticism about the value of broad-based cuts. For Beehive watchers, the questions to press are precise. How is turnover defined. What is the treatment of subsidiaries. Does the $1 billion figure allow for growth in the eligible base. And how does the party reconcile a company-rate cut with a personal-rate system for the self-employed.
