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12/02/2008

News / United States, New Zealand Sign Protocol to Income Tax Treaty

The Treasury Department announced today that Deputy Secretary Robert M. Kimmitt and New Zealand's Ambassador to the United States Roy Ferguson signed a protocol updating the current income tax treaty between the United States and New Zealand.

In a ceremony held at the Treasury Department, the two officials signed a Protocol that brings the existing tax treaty into closer conformity with current U.S. tax treaty policy. The new agreement provides for the elimination of source-country taxation of certain direct dividends, and interest paid to banks and other financial enterprises when the payer of the interest is not a related party. The new protocol also reduces the existing treaty's limit on taxation of cross-border payments of royalties to five percent.

The new protocol introduces a number of technical updates to the existing treaty, and also contains comprehensive and modern rules regarding limitation on benefits, non-discrimination and exchange of information.

The final version of the unsigned protocol is attached.

-30-http://www.treas.gov/press/releases/hp1303.htm

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