New Zealand’s parliament has passed the Taxation (Neutralising Base Erosion and Profit Shifting) Bill, aimed at curtailing tax avoidance by multinationals, Revenue Minister Stuart Nash announced in a June 26 statement.
The new law, which will enter into effect July 1, will address profit shifting through related party transactions including loans, use of hybrid mismatches by multinational groups, foreign company schemes designed to avoid a permanent establishment in New Zealand, and failure to disclose information to revenue authorities.
“This legislation will ensure that multinationals pay tax based on the actual economic activity they carry out in New Zealand,” Nash said.
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