A recent feature on foreign trusts paints New Zealand as a haven in as far as tax transparency is concerned. However, lawyer Geoffrey Cone lifts this veil and gets to the bottom of this claim. It is a fact that the OECD has a list of regions that they consider to be a tax haven, however, according to Cone, New Zealand is miles away from ever featuring in this list.
What is a tax haven?
Key traits of a tax haven are that only the nominal taxes are imposed. A closer look at the NZ tax regime shows a lack of transparency and restrictive laws that inhibit the transfer of information within the governmental departments. It is on the basis of these grounds that Cone disqualifies NZ as a tax haven.
Further merits of disqualification
In many of the countries, a person who wishes to settle a trust agreement is required to file a report with the central bank, revenue authorities, and other relevant authorities. This information is what is used to request for details of a particular transaction or trust.
A look at the tax regime in New Zealand shows that it has thirty nine double tax agreements. The agreements have been created with the purpose of reducing tax impediments and in an effort to prevent tax evasion and tax avoidance.
The tax agreements do not end there. NZ also has about 20 tax information pacts with other nations. These 20 agreements are limited and mainly concerned with the prevention of evasion, and tax avoidance across the states. In addition to this, NZ recently agreed to a multilateral convention touching on tax matters. These actions are a far cry from a tax haven country.
Not all is bleak in NZ tax matters
While there have been improvements in the regulatory environment witnessed with each regime change, much of the credit has to go the professionals who act in a foreign trustee capacity. Many of the NZ servile providers such as accountants and lawyers are members of International Society of Trust and Estate Practitioners (STEP). These experts work with counterparts in other regions who share the same responsibilities and skills. NZ respected accountants and lawyers who operate on behalf of international clients have contributed significantly to the good reputation of NZ among internal experts and in the OECD.
Geoffrey Cone is one of these tax law professionals who has worked with global families and walked with them on international tax matters. He is one of the partners at Cone Marshall. As evidenced, all is not rosy even in states assumed to be tax havens. As such, you need the expertise of a tax lawyer who can help you navigate the murky waters. Geoffrey Cone and his team of experts at Cone Marshall fit this profile.
Follow Geoffrey Cone on LinkedIn