New Zealand will be strongly aligned with the OECD in tackling the issue of fairly taxing multinationals, Revenue Minister Peter Dunne said today.
He said transparency was important in New Zealand operations generally.
“It is part of the Government’s better public services work and as part of this work, there has been on-going consideration of the role of tax secrecy and how to retain its important principles, yet actually achieve what we need to in a complex financial and corporate world,” he said.
“And while the tax privacy of taxpayers is very important, there is a perception that different considerations may apply to multinationals. For example, Australia announced this week its intention to improve the transparency of its business tax system.
“This issue could be part of the OECD’s focus, but it would be a mistake to see the global problems involved as easily fixed,” Mr Dunne said.
“Considerable work in this area is necessary in order to allow tax systems around the world to cope with changes in business practice. What OECD nations are doing is designing a new approach for a new world where internet-based transactions are the norm.
“This is a very complex problem and it will need a multi-layered response, and that is why we have officials working closely with the OECD,” he said.
“New Zealand has also been working on strengthening its domestic laws in this area. Most recently, we made changes to strengthen the thin capitalisation rules.
“If we follow good processes, we can expect good outcomes,” Mr Dunne said.
He said he hoped to be able to report on developments in the OECD work over the next few weeks.