Ensuring that permanent spending or tax cuts are implemented in a sustainable manner would encourage the strong fiscal position that New Zealand needs to meet potentially large macroeconomic shocks and long-run ageing-related costs.
In a boost for international efforts to strengthen co-operation against offshore tax evasion, seven new countries have joined the agreement to exchange information automatically under the OECD/G20 standard.
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New Zealand has the 2nd lowest tax wedge among the 34 OECD member countries. The average single worker in New Zealand faced a tax wedge of 17.2% in 2014 compared with the OECD average of 36.0%.
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The tax burden in New Zealand declined by 0.9 percentage points from 33.0% to 32.1%, the third largest fall amongst member countries in 2013. The OECD average was an increase of 0.4 percentage points from 33.7% to 34.1%. New Zealand’s standard GST rate is 15%, which is below the OECD average. The average VAT/GST standard rate in the OECD was 19.1% on 1 January 2014.
Bilateral Agreements that have been signed to establish exchange of information for tax purposes.
OECD countries acknowledge that taxes must play a role in the process of fiscal consolidation as they battle unprecedented budget deficits. In 2010, the majority of OECD governments have stabilised their tax to GDP, with the average ratio moving up slightly from 33.8% in 2009 to 33.9% in 2010.
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Agreement between Germany and St. Vincent and the Grenadines for the exchange of information relating to tax matters
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Agreement between Germany and Dominica for the exchange of information relating to tax matters
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Agreement between Saint Kitts & Nevis and New Zealand for the exchange of information relating to tax matters
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Agreement between New Zealand and Turks & Caicos for the exchange of information relating to tax matters