Hong Kong’s tax authority has signed a bilateral agreement with its counterpart in New Zealand concerning the automatic exchange of financial account information (AEOI) scheme.
The Inland Revenue Department (IRD) said in a statement last Friday that its agreement with New Zealand expands its AEOI partner network to 14 jurisdictions.
Hong Kong and New Zealand previously had a double tax agreement in place – effective from 2010 – though this was limited to exchanges of information on request.
“The protocol will remove this limitation to allow automatic and spontaneous exchanges of tax information to take place,” said Judith Collins, New Zealand’s revenue minister.
Meanwhile, an IRD spokesperson reiterated Hong Kong’s intention to be included in the multilateral convention on mutual administrative assistance (MCAA) – a move that would significantly broaden the city’s tax treaty network.
“An amendment bill will be introduced into the Legislative Council by late 2017. This will help further expand our AEOI network,” the spokesperson said.
“Hong Kong may be changing from a bilateral approach to a multilateral approach,” Joanna Caen, senior consultant and head of private wealth for China at law firm Herbert Smith Freehills, told Asian Private Banker last week.
“This may be because Hong Kong will have a FATF [Financial Action Task Force] review in October and November this year, and may be facing pressure to increase the number of countries with which it is exchanging information in a short period of time,” Caen said.
In addition to New Zealand, Hong Kong has signed bilateral tax agreements with Indonesia, Belgium, Canada, Guernsey, Ireland, Italy, Japan, Korea, Mexico, the Netherlands, Portugal, South Africa and the United Kingdom.