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PM rejects NZ tax haven claim

NZ NewswireNZ Newswire 8/05/2016

© Getty Images Prime Minister John Key has rejected allegations the country is a tax haven after the release of new documents relating to the Panamanian law firm Mossack Fonseca.

The documents, which reference New Zealand 61,000 times, were handed to Radio NZ, One News and journalist Nicky Hager and released on Monday.

They show a New Zealand accountancy firm, Bentley's in Auckland, is the registered office of Mossack Fonseca NZ, and it helped set up foreign trusts and companies here.

Most were for wealthy people from South American countries.

The parent company, at the centre of the Panama Papers leak of 11.5 million documents, promoted New Zealand as a country which would offer clients "appropriate mechanisms for wealth protection, inheritance and tax planning".

Mr Hager said the papers were clear: "New Zealand is functioning as a tax haven."

But Mr Key said that was not so.

"Just because Nicky Hager says it is, doesn't mean that it is the case," he told the Paul Henry show.

Bentley's co-founder Roger Thompson said labelling New Zealand as a tax haven was incorrect.

"I think the painting of New Zealand as a tax haven has been grossly exaggerated," he said in written answers to questions from the journalism collaboration.

"I don't see New Zealand is a tax haven I would describe it as a high quality jurisdiction for trusts with a benign tax system in certain circumstances."

He said New Zealand was attractive because it had good trust laws, a good independent non-corrupt judicial system and was stable economically and politically.

"The use of trusts and people's rights to keep their business and personal affairs private and confidential is legitimate and normal."

Mr Thompson said assuming that all New Zealand foreign trusts are being used for illegitimate purposes was unfounded.

"I would expect that those looking to use trusts for tax evasion or other illegitimate purposes would choose alternative jurisdictions with secrecy laws."

Mr Key said if a review headed by tax expert John Shewan recommended changes then they would be made and the Inland Revenue would also look through the database to check if local companies were avoiding tax.

Labour leader Andrew Little said on Sunday it would ditch foreign trusts if it was in power while Green co-leader James Shaw said disclosure rules should be tightened.

New Zealand has more than 11,000 foreign trusts.

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