Taxation (Neutralising Base Erosion and Profit Shifting) Bill

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Hon Stuart Nash

Taxation (Neutralising Base Erosion and Profit Shifting) Bill

Government Bill

3—3

	Key
1	Title
2	Commencement
	Part 1 Amendments to Income Tax Act 2007
3	Income Tax Act 2007
4	Section BH 1 amended (Double tax agreements)
5	New section CH 10B inserted (Interest apportionment: public project debt)
	CH 10B	Interest apportionment: public project debt
6	New heading and section CH 12 inserted
		Financial instruments and hybrid mismatches
	CH 12	Income from hybrid mismatch arrangement
6B	Section CW 59C amended (Life reinsurance outside New Zealand)
7	New heading and section CX 64 inserted
		Financial instruments and hybrid mismatches
	CX 64	Income from financial instrument
7B	Section DB 7 amended (Interest: most companies need no nexus with income)
8	New heading and section DB 57B inserted
		Hybrid and branch mismatches of deductions and income from multi-jurisdictional arrangements
	DB 57B	Matching of deductions and income from multi-jurisdictional arrangements
9	Section DR 3 amended (Life reinsurance outside New Zealand)
10	Section EX 20D amended (Adjustment of cost fraction for excessively debt funded CFC)
11	Section EX 20E amended (Relative debt-asset ratio for CFC)
12	Section EX 44 amended (Five calculation methods)
13	Section EX 46 amended (Limits on choice of calculation methods)
14	New section EX 47B inserted (Method required for shares subject to certain returning share transfers)
	EX 47B	Method required for shares subject to certain returning share transfers
15	Section EX 52 amended (Fair dividend rate annual method)
16	Section EX 53 amended (Fair dividend rate periodic method)
17	New section FE 4B inserted (Meaning of public project asset, public project debt, and public project participant debt)
	FE 4B	Meaning of public project asset, public project debt, and public project participant debt
18	Section FE 5 amended (Thresholds for application of interest apportionment rules)
19	Section FE 6 amended (Apportionment of interest by excess debt entity)
19B	Section FE 7 amended (Apportionment of interest by reporting bank)
20	New section FE 7B inserted (Interest on public project debt for certain excess debt entities)
	FE 7B	Interest on public project debt for certain excess debt entities
21	Section FE 8 amended (Measurement dates)
22	Section FE 10 amended (Currency)
23	Section FE 11 replaced (Temporary increases or decreases in value)
	FE 11	Disregarded increases or decreases in value
24	Section FE 12 amended (Calculation of debt percentages)
25	Section FE 14 amended (Consolidation of debts and assets)
26	Section FE 15 amended (Total group debt)
27	Section FE 16 amended (Total group assets)
28	New section FE 16B inserted (Total group non-debt liabilities)
	FE 16B	Total group non-debt liabilities
29	Section FE 18 amended (Measurement of debts and assets of worldwide group)
29B	Section FE 21 amended (Banking group’s New Zealand net equity)
29C	Section FE 23 amended (Banking group’s funding debt)
30	New subpart FH inserted (Hybrid and branch mismatches of deductions and income from multi-jurisdictional arrangements)
		Subpart FH—Hybrid and branch mismatches of deductions and income from multi-jurisdictional arrangements
	FH 1	Subpart implements OECD recommendations for domestic law
	FH 2	Order of application of provisions
	FH 3	Payments under financial instruments producing deduction without income
	FH 4	Receipts under financial instruments producing deduction without income
	FH 5	Payments by New Zealand resident or New Zealand deducting branch producing deduction without income
	FH 6	Receipts from non-resident or foreign deducting branch producing deduction without income
	FH 7	Payments to person outside New Zealand producing deduction without income
	FH 8	Expenditure or loss through hybrid entity or foreign deducting branch producing double deduction without double income
	FH 9	Expenditure or loss of hybrid entity, or non-resident through deducting branch, producing double deduction without double income
	FH 10	Expenditure or loss of dual resident company producing double deduction without double income
	FH 11	Residents, or non-residents with deducting branches, having expenditure funding overseas hybrid mismatches
	FH 12	Offset of mismatch amounts against surplus assessable income
	FH 13	Election by borrower under financial arrangement
	FH 14	Irrevocable election by owner of hybrid entity
	FH 15	Definitions
31	New heading and section FZ 8 inserted
		Interest apportionment rules
	FZ 8	Transition period for amendments to interest apportionment rules
32	Section GB 2 amended (Arrangements involving transfer pricing)
33	New section GB 51B inserted (Increases or decreases in value)
	GB 51B	Increases or decreases in value
34	New heading and section GB 54 inserted
		Arrangements involving establishments and non-resident businesses
	GB 54	Arrangements involving establishments
35	Section GC 6 amended (Purpose of rules and nature of arrangements)
36	Section GC 13 amended (Calculation of arm’s length amounts)
37	New heading and sections GC 15 to GC 19 inserted
		Cross-border related borrowing
	GC 15	Aspects of loan adjusted for application of sections
	GC 16	Credit rating of borrower: other than insuring or lending person
	GC 17	Credit rating of borrower: insuring or lending person
	GC 18	Loan features disregarded by rules for transfer pricing arrangements
	GC 19	Sections GC 15 to GC 18 and financial arrangements entered before application period
38	New section HD 30 inserted (Members of wholly-owned large multinational group)
	HD 30	Members of wholly-owned large multinational group
39	Section IA 2 amended (Tax losses)
40	Section LE 1 amended (Tax credits for imputation credits)
41	Section RF 2C amended (Meaning of non-resident financial arrangement income)
42	New section RF 11C inserted (Interest paid by non-resident companies to non-residents)
	RF 11C	Interest paid by non-resident companies to non-residents
42B	Section RM 2 amended (Refunds for overpaid tax)
43	Section YA 1 amended (Definitions)
44	Section YD 4 amended (Classes of income treated as having New Zealand source)
45	New section YD 4B inserted (Meaning of permanent establishment)
	YD 4B	Meaning of permanent establishment
46	Section YD 5 amended (Apportionment of income derived partly in New Zealand)
47	New section YD 5B inserted (Attribution of income and expenditure to permanent establishment in New Zealand)
	YD 5B	Attribution of income and expenditure to permanent establishment in New Zealand
48	New schedule 23 inserted (Meaning of permanent establishment)
	Part 2 Amendments to Tax Administration Act 1994
49	Tax Administration Act 1994
50	Section 17 amended (Information to be furnished on request of Commissioner)
51	New section 21BA inserted (Information required to be provided by large multinational group)
	21BA	Information required to be provided by large multinational group
52	New section 78G inserted (Country-by-country report from large multinational group)
	78G	Country-by-country report from large multinational group
53	New section 139AB inserted (Penalty for member of large multinational group failing to provide information)
	139AB	Penalty for member of large multinational group failing to provide information
53B	New section 142GB inserted (Due date for payment of penalty by member of large multinational group)
	142GB	Due date for payment of penalty by member of large multinational group
	Schedule New schedule 23
	Legislative history

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