Proposal on tax treatment of stapled stock instruments to go to Cabinet

Finance Minister Michael Cullen said in a statement on Friday that he will take a proposal to the Cabinet on Monday seeking to clarify the tax treatment of certain stapled stock instruments.

“The government is moving to ensure that stapled stock instruments cannot be used for the purposes of receiving excessive interest deductions against the New Zealand tax base,” Dr Cullen said.

“The Inland Revenue Department and the Treasury have for some time been considering this issue which has the potential to erode the tax base,” Dr Cullen said.

Further details will be released on Monday.