Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Exporters need transfer pricing clarity

17 March 2014

Exporters need transfer pricing clarity

The benefits of the New Zealand Government’s desire to push export led growth, as part of its overall economic strategy, could be stymied by a lack of clarity over proposed cross-border tax changes.

New research from the Grant Thornton International Business Report survey (IBR) reveals that New Zealand business leaders want more guidance relating to cross-border tax planning compared with 12 months ago, in stark contrast with the rest of the world.

Greg Thompson, Grant Thornton New Zealand Partner and National Director, Tax, said that on average the proportion of global business leaders who would welcome more co-operation and guidance from tax authorities on what is acceptable tax planning, dropped 15 percentage points to 53%.

“Large declines were seen in North America (-16%) and the EU (-15%) as well as in BRIC (-15%) and Asia-Pacific (-11%) economies. This indicates those business leaders have a greater level of comfort about their Government’s views on acceptable tax planning.

“In New Zealand, things have gone the other way – there has been a 6% increase in the number of businesses looking for clarity on this subject. Only Peru (18%), Ireland (12%) and Chile (10%) are ahead of New Zealand with greater increases to their concerns,” said Thompson.

“In the last year, especially since the headlines around the levels of corporation tax being paid by multinationals like Amazon, Apple, Google and Starbucks, there has been a lot of rhetoric, but not much tangible evidence of progress being made on this front.

“When multinationals like Amazon, Apple, Google and Starbucks were in the headlines last year it created some hysteria around the world, especially in Europe, America and Asia. This has died down as reflected in the survey showing a global average decline of 15%.

“New Zealand was not caught up in this hysteria and now we are starting to see more concern from New Zealand business leaders spurred by the apparent lack of progress. This is despite a number of exercises under way to establish greater clarity and transparency. For example, the OECD has been given a mandate by the G20 economies to prevent tax base erosion and profit shifting (BEPS) through reform at the global level. Real tangible and workable solutions still seem a long way off.

“Providing greater certainty around transfer pricing was high on the agenda at the World Economic Forum in Davos, Switzerland, earlier this year and remains a key issue for the G20. Much emphasis is now being focused on the G20 meeting in Brisbane in November.

“Media attention has certainly died down over the past year and some global businesses may feel that social pressures relating to tax planning have lessened. There may also be a sense among international corporations that governments are prepared to offer populist rhetoric but actually change very little; after all, these large companies are massive contributors of jobs and economic growth.

"The issue facing New Zealand, reinforced by public statements made by the Government, is that we are a small country and have to stand by and wait for the rest of the world to get clarity around these international tax issues including e-commerce and transfer pricing. Once that has happened, then we can react accordingly. We are the tail, not the dog.

“For the sake of New Zealand businesses, and the Government’s desire to push export led growth, let’s hope that the G20 will start to put some action around the volume of words that have already been spoken on the subject. And hopefully this will lead to further clarity around proposed cross-border tax changes for New Zealand businesses,” he said.

The Grant Thornton International Business Report (IBR) provides insight into the views and expectations of more than 12,500 businesses per year across 45 economies. This unique survey draws upon 22 years of trend data for most European participants and 11 years for many non-European economies. For more information, please visit: www.internationalbusinessreport.com

Data collection
Data collection is managed by Grant Thornton's core research partner – Experian. Questionnaires are translated into local languages with each participating country having the option to ask a small number of country specific questions in addition to the core questionnaire. Fieldwork is undertaken on a quarterly basis. The research is carried out primarily by telephone.

Sample
IBR is a survey of both listed and privately held businesses. The data for this release are drawn from interviews with 3,500 chief executive officers, managing directors, chairmen or other senior executives from all industry sectors conducted between November and December 2013.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Cosmetics & Pollution: Proposal To Ban Microbeads

Cosmetic products containing microbeads will be banned under a proposal announced by the Minister for the Environment today. Marine scientists have been advocating for a ban on the microplastics, which have been found to quickly enter waterways and harm marine life. More>>

ALSO:

NIWA: 2016 New Zealand’s Warmest Year On Record

Annual temperatures were above average (0.51°C to 1.20°C above the annual average) throughout the country, with very few locations observing near average temperatures (within 0.5°C of the annual average) or lower. The year 2016 was the warmest on record for New Zealand, based on NIWA’s seven-station series which begins in 1909. More>>

ALSO:

Farewell 2016: NZ Economy Flies Through 2016's Political Curveballs

Dec. 23 (BusinessDesk) - New Zealand's economy batted away some curly political curveballs of 2016 to end the year on a high note, with its twin planks of a booming construction sector and rampant tourism soon to be joined by a resurgent dairy industry. More>>

ALSO:


NZ Economy: More Growth Than Expected In 3rd Qtr

Dec. 22 (BusinessDesk) - New Zealand's economy grew at a faster pace than expected in the September quarter as a booming construction sector continued to underpin activity, spilling over into related building services, and was bolstered by tourism and transport ... More>>

  • NZ Govt - Solid growth for NZ despite fragile world economy
  • NZ Council of Trade Unions - Government needs to ensure economy raises living standards
  • KiwiRail Goes Deisel: Cans electric trains on partially electrified North Island trunkline

    Dec. 21 (BusinessDesk) – KiwiRail, the state-owned rail and freight operator, said a small fleet of electric trains on New Zealand’s North Island would be phased out over the next two years and replaced with diesel locomotives. More>>

  • KiwiRail - KiwiRail announces fleet decision on North Island line
  • Greens - Ditching electric trains massive step backwards
  • Labour - Bill English turns ‘Think Big’ into ‘Think Backwards’
  • First Union - Train drivers condemn KiwiRail’s return to “dirty diesel”
  • NZ First - KiwiRail Going Backwards for Xmas
  • NIWA: The Year's Top Science Findings

    Since 1972 NIWA has operated a Clean Air Monitoring Station at Baring Head, near Wellington... In June, Baring Head’s carbon dioxide readings officially passed 400 parts per million (ppm), a level last reached more than three million years ago. More>>

    ALSO:

    Get More From Scoop

     
     
     
     
     
     
     
     
    Business
    Search Scoop  
     
     
    Powered by Vodafone
    NZ independent news