Media release - 9 November 2012
Michael Wright - Senior Manager, Financial Risk Management
Yesterday the United States Department of the Treasury announced it is in discussions with more than 50 countries to enter Intergovernmental Agreements to implement the Foreign Account Tax Compliance Act (FATCA).
FATCA targets US tax non-compliance by US taxpayers and Treasury’s engagement with this number of countries highlights increased levels of global cooperation in combating tax evasion.
Whilst the proposed Intergovernmental Agreement will require New Zealand to assist the US in reducing tax evasion by US persons, the New Zealand government will be entering negotiations with an expectation that the US will ultimately provide information on New Zealand citizens with investments in the United States. Inland Revenue will then check to ensure New Zealanders are complying with their New Zealand tax obligations. Once New Zealand has a framework in place for the US, it could be extended to other participating countries.
The United Kingdom has already concluded an Intergovernmental Agreement with the US and the Department of the Treasury announced it is in the process of finalizing Intergovernmental Agreements with France, Germany, Italy, Spain, Japan, Switzerland, Canada, Denmark, Finland, Guernsey, Ireland, Isle of Man, Jersey, Mexico, the Netherlands and Norway. Treasury hopes to have agreements with these countries completed by the end of 2012.
Jurisdictions with which the US is actively discussing Intergovernmental Agreements include: Argentina, Australia, Belgium, the Cayman Islands, Cyprus, Estonia, Hungary, Israel, Korea, Liechtenstein, Malaysia, Malta, New Zealand, the Slovak Republic, Singapore and Sweden. Some of the agreements may be completed this year but many will not be finalised until early 2013.
The US is also working on options for Intergovernmental Agreements with: Bermuda, Brazil, the British Virgin Islands, Chile, the Czech Republic, Gibraltar, India, Lebanon, Luxembourg, Romania, Russia, Seychelles, Sint Marten, Slovenia and South Africa.
For media inquiries please contact:
+64 9 367 5977
+64 21 335 740