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Media releases

Structured finance cases settled

The Commissioner of Inland Revenue, Robert Russell, and the Solicitor-General, David Collins QC, said they are pleased long-running tax disputes involving four major banks have been settled.

The BNZ, Westpac, ASB Bank, and ANZ National have agreed to settle cases with Inland Revenue by accepting liability for a combined sum that exceeds $2.2 billion.

The settlement, believed to be the largest commercial settlement in New Zealand's history, follows Inland Revenue's success in the High Court this year in two cases involving a particular type of transaction known as "structured finance".

Mr Russell said it had been Inland Revenue's long-held view that the transactions were tax avoidance.

"Our decision to pursue these cases has been shown to be absolutely right, and it has returned a very good result for the taxpayers of New Zealand."

"We believe this sends a strong signal to companies operating in New Zealand - like all taxpayers they must meet their obligations."

Mr Russell and Dr Collins said the cases showed that Inland Revenue and Crown Law have the resources and capability to pursue very complex cross-border transactions.

"I would like to thank our many staff who put incredible work into these cases, and also acknowledge our colleagues in the Crown Law Office for their work,” said Mr Russell.

Dr Collins said he was particularly grateful for the exceptional efforts that were made by external counsel and the Tax and Commercial Team at Crown Law.