5 May 2016

National confirm bias for foreign trust industry

Former Revenue Minister Todd McClay met twice with foreign trust lobbyists but met with no other stakeholder groups before deciding to stop a review into foreign trusts, the Green Party said today.

The current Minister of Revenue, Michael Woodhouse, confirmed the one-sided process taken by his predecessor in Parliament at Question Time today. Minister McClay met with the Prime Minister’s lawyer, Ken Whitney, and others on December 18 in Auckland and then one other time with OliverShaw acting as advisors to the foreign trust lobby.

“Revenue Minister Todd McClay made a rapid about-turn on a foreign trust review based solely on input from industry lobbyists and sought no other advice from other stakeholders,” said Green Party Co-leader James Shaw.

“Stakeholders like the international development community, the Tax Justice Network, the Law Foundation, the UN Convention against Corruption, Transparency International, or tax experts like Professor Craig Elliffe or Dr Deborah Russell were not given the chance to inform Government policy on foreign trusts.

“Documents released last week also reveal that the Minister gave a guarantee in his very first meeting with foreign trust lobbyists that their industry would not be reviewed.

“The current Minister of Revenue also appeared surprised by estimates from the foreign trust industry itself that there are up to 20,000 foreign trusts administered in New Zealand — 8,354 more foreign trusts than are currently registered with the IRD.†

“Nearly half of all foreign trusts in New Zealand could be operating illegally.

“IRD has previously said its numbers of registered foreign trusts may be significantly underestimated because of the existence of ‘structures whose purpose is to defeat the statutory disclosure requirements’.†

“I intend to write to John Shewan and urge him to make his review of our shady foreign trust industry less one-sided than National’s.”

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