Wanaka had been hurt over the years by its inability to provide a full holiday experience over Easter Weekend, Mr Cocks said.
"People from all around New Zealand and the world come here and they expect certain levels of service, and it was really damaging our reputation as a wonderful destination."
Wanaka Paper Plus manager Chris Lumsden described the change as "great news", and "all we've ever wanted".
The store stayed open every Easter Sunday in defiance of the 1990 Shop Trading Hours Repeal Act, Mr Lumsden said, and had successfully fought two charges for breaching the law.
Yes Photo and Digital owner Steve Worley said the proposed law was "a step in the right direction", but it was a "half-hearted measure" if it did not include Good Friday as well.
Rotorua's Chamber of Commerce has also welcomed the trading law change.
The town had historically been disadvantaged because Queenstown and Taupo have been able to open, chamber chief executive Darrin Walsh told Newstalk ZB.
"For some reason Rotorua has been on the outer and hasn't been able to open, which didn't seem to make sense with Rotorua the tourist centre that it is."
The Anglican Church also welcomed the liberalising of Easter trading laws, saying shops opening would not overshadow the meaning of Easter Sunday.
Not all New Zealanders were Christian and people should be allowed the choice to trade or not, spokesperson Reverend Jayson Rhodes said.
"Whether shop doors are open or closed it, to a degree, is immaterial. The church is big enough and bold enough to celebrate Easter no matter what the shops are doing."
But some people are not happy with the new bill, which is expected to be introduced in the coming weeks, and will be implemented by local councils, which will decide if their districts can open on Easter Sunday.
Christchurch gardening store owner Darryn Odering, of Oderings nurseries, accused the Government of passing the buck, and said the new law didn't go far enough.
"All they are doing is tinkering with archaic outdated laws. The Government should take the bull by the horns, show some leadership and change the laws."
Mr Odering said he could not see why the Government didn't just create a bill to scrap the law completely.
Retail New Zealand Public Affairs General Manager Greg Harford doesn't believe the Government should choose when retailers can open shop.
"We're strongly of the view that nobody should be forced to shop, that no employee should be forced to work.
"But if people want to shop or work or open their shops, we don't think there is any reason for them not to do so."
Others have hit out at the inconsistency of allowing Easter Sunday trading, but not Good Friday.
Keith Allan of Palmers Garden Shop in Miramar, Wellington, said the law needed to extend to Good Friday as well.
"Two-hundred yards down the road, we've got service stations that sell petrol, oil, cigarettes, and they're allowed to be open on Good Friday. It doesn't seem quite right."
But Mr Woodhouse said the current rules for Good Friday would remain in place, because there was added religious and cultural significance attached to Good Friday, Anzac Day and Christmas.
First Union retail secretary Maxine Gay said the proposed legislation was "selfish and nasty" on the part of Mr Woodhouse.
The exemptions included in the 1990 Act were "outdated", but a better solution would have been to change the exemptions, not change the law, she said.
"It seems like lazy politics to put this out to local authorities to make the decision."
There was no reason why Wanaka could not be granted an exemption every second year for celebrations held there that drew thousands of people, she said.
Ms Gay also threw doubt on Mr Woodhouse's assurance that staff would be able to decline work on Easter Sunday without giving a reason.
"It's an empty promise," she said. "Some things are more important than trade."
Conservative group Family First NZ also hit out at the law change, questioning how long it would take for Christmas Day and Anzac Day trading to follow suit.
"We reject any liberalisation of Easter trading laws because workers deserve this special annual break to spend time with their families," national director Bob McCoskrie said.
"The Government doesn't seem to understand that a focus on economic improvement should never come at the cost of weakening the quality and special time that families can spend together."
Tourists "will cope", Mr McCoskrie said, as they do in many other countries where shops close down on public or religious holidays.
"Towns do have every right to feel peeved that neighbouring towns can stay open when they can't. The law needs to be consistent and enforced."
The law change is expected to come in effect from Easter 2017.
- Additional reporting: Otago Daily Times and Newstalk ZB
