NZ/Mexico sign double tax agreement
New Zealand and Mexico have signed a double tax agreement, Revenue Minister Peter Dunne announced today.
"The new double tax agreement, once in force, will help reduce tax impediments to trade and investment between our two countries," Mr Dunne said.
"Mexico is our top Latin American trading partner. It accounts for nearly half of our exports to the region, and is one of our most important milk powder markets.
"Our exports to Mexico in the year to June 2006 were worth $NZ429 million and consisted primarily of dairy products and meat.
"Mexican imports to New Zealand for the same period were worth $NZ122 million and consisted primarily of computers, transmission apparatus, motor vehicles and beer.
"Double tax agreements are very useful treaties. They prevent cross-border business income being taxed twice and give greater certainty about how that income is to be taxed. They also reduce compliance costs for certain activities and lower tax on some income.
"New Zealand is already party to double tax agreements with 32 other countries, and I welcome the forthcoming agreement with Mexico, with whom we have a long friendship.
"The double tax agreement will come into force once both parties have given legal effect to it, which in New Zealand's case will occur through Order in Council," Mr Dunne said.
The text of the double tax agreement, signed on 16 November at the APEC Economic Leaders' Meeting in Hanoi, is available at www.taxpolicy.ird.govt.nz.