From next year a significant new measure for countering tax evasion will become available to Inland Revenue, says Revenue Minister Todd McClay.
The Convention on Mutual Administrative Assistance in Tax Matters, signed in 2012, provides for administrative co-operation between tax authorities in the assessment and collection of taxes.
“From 1 January 2015 the convention becomes operative for New Zealand. That means from that date, Inland Revenue’s powers to discover evasion and pursue tax debt overseas will be greatly strengthened,” Mr McClay says.
He says Inland Revenue will be able to seek assistance from other tax authorities similarly signed up to the convention - for example in collecting outstanding tax debts from taxpayers who have moved overseas.
“Some people believe that when they leave New Zealand they can escape their tax debts. They need to be aware that offshore no longer means off limits.
“In a modern society, it is important that everyone pays their fair share of tax and that is what the multilateral convention is all about,” says Mr McClay.