The KPMG report found the two countries could enjoy a seamless transfer of skilled people if the Australian and New Zealand governments got their act together.

Relatively minor changes in areas ranging from superannuation tax rules to withholding taxes, could add to the economic performance of the trans-Tasman partners, KPMG said.

KPMG partner in tax practice Andy Hutt said barriers now in place were impeding the free flow of skills between the two countries.

"Trans-Tasman businesses regularly transfer people between Australia and New Zealand to meet their business needs," he said in a statement.

"This relocation of people promotes the transfer of skills and experience which can be extremely beneficial to the economies of both countries.

"But there are a number of taxation barriers which impede the seamless transfer of skilled people to the detriment of both economies. These barriers may reduce the free flow of skills between the countries and consume unnecessary management resources."

KPMG found that just in the superannuation area differences between the two countries added to the cost of moving staff across the Tasman.

While foreign citizens paying mandatory superannuation in Australia can withdraw that when leaving the country, this is not possible in New Zealand.

KPMG said people on secondment in the other country for less than six months should only pay tax on their salaries in their home nation.

As the two economies were so intertwined, KPMG said the requirement to tax certain foreign exchange gains and losses between Australia and New Zealand should be dumped.

Hutt said the proposals would cost the two countries little revenue, but would make life much easier and cheaper for business and employees.

"These recommendations are achievable and should be relatively low-cost to both countries," he said.