Equity Crowdfunding in New Zealand: The Role of Income Tax Incentives

Equity crowdfunding facilitates companies’ access to capital, particularly for start-ups. In New Zealand, light-handed regulation and a syndication model have contributed to the growth of equity crowdfunding. This article analyses the effects of income tax legislation on crowdfunding in New Zealand and considers how — and whether — amendments to income tax legislation could further promote this form of private investment. This paper argues that dissonance exists between financial markets policy on crowdfunding and tax policy on research and development. In the context of dire predictions for Covid-19-related job losses, the potential for crowdfunding to promote start-ups, and to create jobs, deserves tax policymakers’ attention.