Independent expert likely to probe NZ's foreign trust rules

Monday 11 April 2016 09:06 AM

Independent expert likely to probe NZ's foreign trust rules: PM

By Pattrick Smellie

April 11 (BusinessDesk) - Prime Minister John Key is signalling a change of heart on the government's insistence last week that New Zealand's foreign trust rules are sound, telling RNZ's Morning Report programme the Cabinet will consider a proposal for an inquiry by an independent expert.

Under pressure from revelations in the global leak of tax dodging practices known as the Panama Papers, Key said it was "highly likely that the government will ask an expert in this area to undertake an independent review."

It might also turn out there "may be other learnings" outside such a review "in terms of disclosure," Key said.

In the same interview, he insisted he had not used foreign tax-sheltering vehicles, although he had "no intention" of releasing his personal tax returns, as British Prime Minister David Cameron was forced to do last week following disclosures relating to his late father's use of foreign trusts, contained in the Panama Papers.

"I don't use tax-sheltering vehicles. I have never used those and I don't use those," said Key. He had a superannuation fund domiciled in Singapore, dating back to the time when he worked there. He had two domestic trusts through which he managed his personal affairs. Parliament's rules on disclosures of pecuniary interest were robust and he used "the best people" for his personal tax returns.

However, Labour Party leader Andrew Little said a single expert's review was not enough and, like New Zealand First leader Winston Peters, called for an independent commission of inquiry.

"He must instead launch a full independent inquiry into the details coming out of the Panama Papers," Little said. “New Zealand’s reputation is being sullied around the world. One tax expert isn’t going to solve this, especially one appointed by a Prime Minister who doesn’t think hiding their finances behind tax-free funds is morally wrong."

New Zealand First's Peters has called for a commission of inquiry, while the Green Party says it would require foreign trusts in New Zealand to register and disclose more complete information on the identity of the settlors, their country of residence, related parties, and require annual financial reporting.

(BusinessDesk)

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