Sharechat Logo

Tax change furthers NZ financial hub potential

Thursday 1st September 2011

Text too small?

Little-noticed tax changes signed into law this week are a key step in allowing New Zealand to offer back-office financial market services in the Asia-Pacific region, says Craig Stobo, chair of the government-appointed task force that reported on the issue last year.

The law change removing tax obligations on non-resident investors in Portfolio Investments Entities (PIEs) holding only international assets represented “significant progress” in establishing the environment necessary for global funds to have back-office processing occur in a New Zealand hub, Stobo told the Institute of Finance Professionals of New Zealand conference in Wellington yesterday.

While the financial services “hub” idea has languished somewhat, despite initial backing from Prime Minister John Key, Stobo said New Zealand’s opportunity to offer such services in the Asia-Pacific region represented an untapped niche.

While such services were routinely offered from Ireland, Luxembourg and the Cayman Islands, their offerings were “Euro-centric”, with little affinity for Asian markets, and there were no such funds domiciled in the Asia-Pacific region, said Stobo.

“We understand Asia better,” he said. “But the funds have to have zero tax. This is an important part of engaging globally.”

He expected New Zealand PIEs holding foreign assets only to grow relatively quickly, although a more complex alternative regime for PIEs with a mix of New Zealand and international assets, would be slower to grow.

“The Government’s come to the party,” said Stobo. “The call to action is for the private sector get going.”

(BusinessDesk)

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar stalled; US-China trade deal may be postponed
AFT Pharmaceuticals starts to hit its straps
Crown seeks US$100m from Tui operator; Prospector moving on
Pacific Edge goes back to shareholders for another $20m
Crown seeks $100m from Tui operator Tamarind
Ryman underlying annual profit may rise by up to 17%
NZ dollar eases on increasing US-China doubts, lack of news in Fed minutes
From dog tucker to top dog: economists ask how Northport can be Auckland’s best replacement
MARKET CLOSE: NZ shares rise; Metlife jumps on takeover talk
NZ dollar eases on technical factors, buoyed by higher dairy prices

IRG See IRG research reports