New Zealand Minister Outlines Anti-BEPS Plans
New Zealand will take steps to prevent base erosion and profit shifting (BEPS) while at the same time ensuring that the country continues to be a good place to do business, Todd McClay, Minister of Revenue, has said.
McClay was addressing a recent conference organized by the Chartered Accountants Australia and New Zealand on the issue of BEPS.
McClay said that the Government’s tax policy work is focused on three main themes: sensible reforms within a broad-base, low-rate framework; tax administration reform to support Inland Revenue’s business transformation; and a sensible, measured response to BEPS.
McClay said that he will agree with the Minister of Finance on appropriate BEPS items to add to the work programme. “We consider that there may be room for improvement in some areas of our tax rules. In particular we will be looking at interest limitation rules and whether or not they are cast appropriately. We will also be considering strengthening our anti-hybrid rules,” he told participants.
The Minister however stressed that, “from the Government’s point of view, BEPS should not be seen as loading more and more onerous burdens on firms.” He added that “any tax policy changes to address BEPS concerns are not unduly complex and nothing is yet set in stone…An important component in our consultation on BEPS work will be outlining the Government’s thinking on how best to tax inbound investment.”
“BEPS is a matter of global concern for tax jurisdictions and no less so for New Zealand. The OECD is leading the charge at an international level, but New Zealand’s response will, as always, be to take the considered view and consider the OECD recommendations and how they fit in with our tax system as a whole,” he concluded.
