The New Zealand government confirmed final decisions regarding taxation of multinationals to address Base Erosion and Profit Shifting (BEPS) and facilitate a fairer taxation. All these changes will be implemented via a tax bill and come into force by July 2018.
The decisions consider the feedback of public consultation regarding governmental documents relating to hybrid mismatch arrangements, interest limitation rules, transfer pricing and permanent establishment avoidance. The measures proposed in the decisions will:
The decisions intend to have companies operating in New Zealand to pay their fair share of tax, and multinationals that attempt to minimize or eliminate their New Zealand tax obligations are also targeted by the proposals. On their implementation, the changes are supposed to ensure that multinationals are on the basis of their actual level of economic activity in New Zealand.
“The Government budgeted for $100 million annually in out-years for additional multi-national tax, and these decisions mean that will be increased by a further $100 million annually from Budget 2018 onwards.” according to Finance Minister Steven Joyce and Revenue Minister Judith Collins.
Transfer Pricing Associates introduces TPA BEPS Desk. If you have any questions, or need more detailed advice on any aspects of BEPS related issues, please get in touch with us. The TPA Global network has alliance partners throughout the world, and the network can provide multi-disciplinary approach on today's critical transfer pricing challenges faced by multinational enterprises.
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