Govt must act as NZ singled out in Panama Papers scandal

New Zealand's international reputation is seriously at risk as further information from the Panama Papers comes to light, says Labour’s finance spokesperson, Grant Robertson.

"New Zealand's role in the largest global tax haven scandal in history is nothing to be proud of.  As more information comes to light it is clear that the world's mega-rich have seen our country as a place to hide their wealth, including when they are the focus of investigation in their own countries.

"John Key's failure to take this issue seriously, and to commit to an independent inquiry is bad enough, but now he and New Zealand are being singled out for supporting highly unethical or even illegal behaviour.  It is hugely embarrassing to have not only New Zealand at the centre of this scandal, but also Niue and the Cook Islands.

"Material released in the last twenty four hours shows that Mossack Fonseca saw New Zealand's rules on foreign trusts and look through companies as a huge loophole.  They urged staff to "chase the money" in New Zealand, especially after changes by the National government in 2010 to allow zero rating for tax for LTCs. Hundreds of millions of dollars, some from highly dubious sources, turned into a ‘torrent’ coming into New Zealand.

"We urgently need to re-establish an independent inquiry into tax evasion and the whole operation of the foreign trust industry. The evidence is mounting that this industry has a rotten core, and our enabling of it needs a serious re-assessment.  We owe it to working people here in New Zealand and around the world who pay their fair share to crack down on those who hide their wealth and do not pay their tax.

"John Key is far too close to this industry – his close personal advisor Ken Whitney is heavily involved and lobbied against changes to the rules – and this has made him out of touch with the deep concern of New Zealanders that we are now donkey deep in a global scandal. It is past time to act," Grant Robertson says.