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No official word on EU probe: Woodhouse

NZ Newswire logoNZ Newswire 1/08/2016

The government hasn't received any official word that New Zealand is being investigated by the European Union as it looks to draw up a blacklist of tax havens.

But even if the EU does investigate, Revenue Minister Michael Woodhouse says New Zealand has "nothing to fear".

Last month the European Parliament backed an EU Commission plan to draw up a "common EU blacklist" of "non-cooperative jurisdictions".

The action comes in the aftermath of the release of the Panama Papers - which prompted a review of New Zealand's foreign trust rules - and Newshub reports New Zealand's tax laws are coming under the EU's scrutiny.

Mr Woodhouse said he found out about the story from the media late on Monday afternoon and he hasn't received any advice from the EU that action is being considered against New Zealand.

He hoped to find out more on Tuesday and in the event New Zealand was investigated, he was not worried.

"The substance of any inquiry certainly doesn't give me cause for concern," he told RNZ.

In an earlier statement, Mr Woodhouse said the government was confident any objective inquiry would come to the same conclusion as the OECD and the Global Forum on Transparency and Exchange of Information for Tax Purposes when they reviewed New Zealand's tax settings: that New Zealand was fully compliant with OECD standards.

The EU Parliament is calling for sanctions to be able to be imposed on jurisdictions that are deemed unco-operative.

Sanctions could include reviewing and even suspending free trade agreements.

That threat has Labour leader Andrew Little worried.

"As a bloc the EU is New Zealand's fourth largest trading partner and our trade in goods alone is worth $14.3 billion or 14.1 per cent of all goods exports and imports - there is a lot to lose," he said.

"With the big OE an important part of many young Kiwis lives, the threat of travel restrictions is also hugely concerning."

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