The Multilateral Convention to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting has been tabled in Parliament.
The Multilateral Instrument allows several thousand tax treaties around the world to be quickly updated in line with OECD recommendations," says Revenue Minister Judith Collins.
She says the Multilateral Instrument is a major new weapon in the fight against base erosion and profit shifting (BEPS) because tax treaty abuse is often the basis for BEPS techniques.
"The Multilateral Instrument includes articles on 'permanent establishment' avoidance, treaty abuse, dispute resolution and hybrid mismatches. These address the key treaty-related BEPS issues," she says.
"The extent to which these provisions are incorporated into New Zealand’s treaties will depend on the final positions of both New Zealand and our treaty partners."