The Possibility of Amending New Zealand’s General Anti-Avoidance Rule
(2013) 26 New Zealand Universities Law Review 522-559.
35 Pages Posted: 21 May 2014 Last revised: 7 Aug 2014
Date Written: May 19, 2014
In 2011 a Committee comprising representatives of the New Zealand Law Society, the New Zealand Institute of Chartered Accountants and an organisation called the Corporate Taxpayers Group published a Report proposing that the General Anti-Avoidance Rule or GAAR contained in ss BG 1 and GA 1 of the Income Tax Act 2007 should be amended. This article assesses the proposed amendments and concludes that, far from clarifying the law as claimed by the Committee, they would have the opposite effect; that they would consequently tend to increase the amount of litigation; and that they would permit forms of tax avoidance currently proscribed. The article concludes also therefore that it would be a mistake for the government to implement the Committee’s recommendations.
Keywords: Tax avoidance, general anti-avoidance rules, New Zealand, drafting
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