New Zealand And Spain Sign Double Taxation Avoidance Agreement

by Mary Swire, Tax-News.com, Hong Kong

29 July 2005

The President of the Spanish Senate, Francisco Javier Rojo, and New Zealand Revenue Minister Michael Cullen on Thursday July 18 signed a double tax agreement between Spain and New Zealand.

Double tax agreements reduce tax impediments to cross-border trade and investment, ensure that businesses are not taxed twice on income earned in the other country, and assist enforcement of the law between the two countries involved.

Commenting on the new tax agreement, Dr Cullen observed that: “Once in force, the new double tax agreement will help to reduce the costs for New Zealanders doing business in Spain and for Spaniards doing business in New Zealand."

He added that: “It will encourage stronger economic links between our two countries. Spain is growing in importance on our list of trading partners, following recent growth in exports of primary produce from New Zealand, and there is significant potential for increased investment between our two countries."

The double tax agreement will come into force upon ratification by both the Spanish and New Zealand legislatures. In New Zealand’s case, this will occur through Order in Council.

New Zealand currently has a network of bilateral tax agreements with 29 countries, with additional agreements with Poland and Chile pending.

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