Using cloud to ease tax pains

When governments look to change tax rates, or introduce new taxes, cloud seems to come into its own.

New Zealand has just increased its GST rate from 12.5 per cent to 15 per cent, something cloud evangelist Rod Drury of Xero described as a "watershed event" for the cloud in New Zealand.

Early in the year, we saw fears of disruption to the country's 600,000 GST-registered businesses, with talk of a fifth of businesses possibly needing new software.

Certainly, adjusting for the new rate seemed to involve more than fiddling with a bit of code.

For vendors like MYOB, the change presented opportunities to sell new upgrades.

However, what struck me was how users of cloud-based software systems had the work done for them!

Rather than every small business owner having to find the right software update and then work through a complex set of steps, cloud-based providers make the changes on behalf of all their customers.

And the GST change is just the beginning; the Inland Revenue Department's "Making Tax Easier" initiative, which aims to move from paper-based systems to customer-focused online technologies, and other policy work will result in a number of other accounting changes over the next few years.

Certainly, this is a fine sell for the cloud.