New Zealand Issues Draft Global Minimum Tax Law


  1. General
  2. Interpretation of the OECD Model Rules
  3. Tax Treaty Override
  5. UTPR
  6. Qualifying Refundable Tax Credits
  7. Capital Gain Carry-Back Election
  8. Imputation Credits
  9. Anti-Inversion Rule
  10. Registration
  11. GloBE Information return
  12. Annual Multinational Top-Up Tax Return
  13. Payment
  14. Transitional Penalty Relief


Yesterday, New Zealand published a draft law (the Taxation (Annual Rates for 2023–24, Multinational Tax, and Remedial Matters) Bill) to implement the Pillar Two Global Minimum Tax.

This is to be known as the ‘Multinational Top-Up Tax’ and consists of an Income Inclusion Rule (IIR) and an Undertaxed Profits Rule (UTPR). There is a specific Domestic Income Inclusion Rule (DIIR) for domestic headquartered MNE Groups (which is not the same as a QDMTT)

The legislation does not provide for an implementation date, which is to be set by Order in Council once the Government determines that a critical mass of countries has adopted the GloBE rules. This would not be earlier than 1 January 2024 for the IIR and 1 January 2025 for the UTPR.

New Zealand is taking a similar approach to Switzerland and Liechtenstein and is directly transposing the OECD Model Rules (and Commentary and other agreed guidance) into domestic law in order to reduce the risk of interpretive errors and mismatches between the GloBE rules as adopted in other countries and as adopted in New Zealand. There are then some slight amendments to tailor the rules to New Zealand’s income tax system.

However, Section BF 1(b) of the ITA provides that the Multinational Top-Up Tax will be an “ancillary tax”, not income tax. As such, it is subject to a a separate administrative regime and will not fall in the scope of the provisional tax regime.

Interpretation of the OECD Model Rules

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