Prime Minister Jacinda Arden has confirmed the Government will no longer seek to introduce a Capital Gains Tax, after the coalition was unable to reach a consensus on how such a tax would be implemented.

Arden said this option was better for New Zealand than pushing out a compromised version of the tax which didn’t achieve what it was originally made to do.

“All parties in the Government entered into this debate with different perspectives and, after significant discussion, (were) unable to find a consensus,” Arden said, according to the NZ Herald.

Retail NZ interim chief executive Greg Harford welcomed the decision, stating that small businesses will be better off without such a tax.

“A Capital Gains Tax would have caused real problems for those investing in small businesses,” Harford said.

“Many small business owners use the goodwill built up in their businesses as a modest retirement savings plan. Many were concerned about the impacts of losing a large chunk of their life savings to the Government through the proposed tax.”

Arden stressed that there are other ways to ensure New Zealand’s tax system become more fair, and that work has already begun in ensuring these changes are implemented.