Tuesday, October 9, 2012
New Zealand's Revenue Minister Peter Dunne has dismissed claims that the country is a tax haven for foreign trusts, announcing that it will sign a major international tax assistance treaty later this month.
New Zealand is to sign the Convention on Mutual Administration Assistance in Tax Matters, formulated jointly by the Organization for Economic Co-operation and Development (OECD) and the Council of Europe. The Convention will give New Zealand's Inland Revenue the ability to request help from other tax authorities in detecting and preventing tax evasion, and in collecting outstanding tax debts.
Making the announcement, Dunne said New Zealand's legislation for taxing trusts is fully transparent and stressed that the rules are "consistent with the wider international norm that a country should not tax non-residents on foreign-sourced income". He also pointed out that the foreign trust taxation rules and treaty exchange of information arrangements and practices were scrutinized last year by the Global Forum on Transparency and Exchange of Information for Tax Purposes review and were approved.
According to Dunne, the impending signature of the Convention is an important step and is consistent with New Zealand's approach to tax matters. It also, he emphasized, "makes a mockery of tax haven assertions".