Prime Minister Jacinda Ardern is reassuring small business owners and farmers that they will be at the top of her mind when it comes to making a final decision on a capital gains tax. 

Speaking with Mike Hosking, Jacinda Ardern said small businesses and farming are crucial to New Zealand's economy and are a top priority.

"I hear what people are saying around the treatment and the consequences and those are all things we are considering and have made no decision on yet."

When asked whether the push back to the capital gains tax was because the majority of Labour's Cabinet has never owned a business, and therefore doesn't understand how they operate, Ardern said, "that is an unfair statement to make".

"Yes, I haven't been an owner or operator [but] I have run a small NGO, I have worked in small businesses and I have been a small business spokesperson."

However, she acknowledged that she hasn't owned a business, saying that is why feedback is so important.

"I have seen the blood and tears that people put into their businesses. They often don't collect salaries themselves. I absolute hear and understand that and we are considering all of that.

MP Greg O'Connor is the only person with experience owning a business. He was a farmer and set up an adventure tourism business.

However, the Prime Minister said the definition of a small business is yet to be finalised.

"For the Tax Working Group, they have made an assumption over revenue [but] there are different ways, of course, of judging a small business."

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"In different areas of government, you sometimes hear it as based on a number of employees, you sometimes hear it based on turnover."

Ardern said when she thinks of a small business she thinks of her first job.

"I think of the fish and chip shop I first worked for."

When asked what was the definition of a farm versus a lifestyle block, she said the Tax Working Group has used the existing definition which is based on the square meterage of the land.

"If you live on a lifestyle block your home isn't covered, the land around your homes isn't covered, but if you have a larger plot of land...that's the area that is covered."

However, Ardern said they need to make some concrete decisions before getting into the technical details.

The Prime Minister reiterated that the government hasn't made any decisions yet.