The recent Budget announcements have provided some “silver lining” to the retail sector, but there won’t be an immediate prospect of a turnaround, Retail NZ says. 

The promised tax cuts are expected to translate into more spending, but theareis unlikely to provide immediate relief, according to Retail NZ CEO Carolyn Young.

“The tax cuts won’t kick in for two months and with signals from the Coalition Government that there will be no return to surplus for several years, Retail NZ is not expecting to see any improvement in consumer confidence. 

“So retailers are unlikely to see an uplift in spending for some time. Our members will need to continue tightening their belts in anticipation of slow sales until confidence returns to the marketplace,” Young explained.

She also mentioned the loss of hundreds of jobs that will come after the potential closure of Smith & Caughey’s next year and Flybuys’ exit from New Zealand.

Aside from tax-related matters, the government will increase spending on policing, combating retail crime, and infrastructure improvement, which is good news for retailers.

Retail NZ also hopes a bigger investment in education will increase work readiness in young people.