Tuesday, February 16, 2010
New Zealandís Prime Minister, John Key, has disclosed that the government is studying one of the recommendations of the Capital Markets Taskforce in December last year, that New Zealand has the opportunity to become a significant player in specialized financial service niches in the Asia-Pacific region.
The particular recommendation that the government is pursuing is that its location gives New Zealand the opportunity to develop a regulatory and tax regime that would support the provision of high-value middle and back office support for fund management, especially for overseas pension funds.
Such funds would be registered and administered in New Zealand. While the study is still at an early stage, the government is attracted by the jobs that would be created by the businesses in the new sector. It has been estimated that up to 5,000 new posts could be created, dependent on its success.
While income and gains within the funds themselves would remain untaxed, taxation of the profits of the fund administration companies would be of further benefit to the country.
While details of how the recommendation could be effected were not given in the taskforceís report, it has been reported that they were provided directly to the Prime Minister. The project is still at an early planning stage, with its structure and the technical changes necessary for its implementation still to be finally decided.