The avoidance of non-resident withholding tax ("NRWT") on interest can occur in two main ways. The parties may adopt structures and/or arrangements which seek to circumvent the statutory provisions defining 'interest' or requiring the tax to be deducted, or alternatively a non-resident lender may exploit an inequality of bargaining power so as to force the resident borrower to bear the cost of the NRWT as well. The New Zealand government has responded to these difficulties by enacting an "approved issue levy" regime, which can provide an alternative to interest NRWT. The author examines the features of this new regime and contemplates its implications.
"New Zealand's Approved Issuer Levy - A Pragmatic "Concession","
Revenue Law Journal:
2, Article 6.
Available at: http://epublications.bond.edu.au/rlj/vol2/iss2/6