CANBERRA—Australia has signed a new tax treaty with New Zealand that will help support business, investors and pensioners, the federal government says.
The new treaty replaces tax rules that have been in place since 1995 and amendments made in 2005.
"New Zealand is a country with which Australia shares an exceptionally close trade and investment relationship," Assistant Treasurer Senator Nick Sherry said in a statement on Monday.
"The changes made by the new treaty to update the taxation arrangements between the countries will be of benefit to both the Australian and New Zealand economies."
The new treaty includes the reduction of withholding tax rate limits on certain dividends, and on certain classes of interest and royalty payments, reducing the cost to Australian business.
It will also assist the Australian managed fund industry by providing rules to allow trusts to access benefits on income derived from New Zealand.
Additionally, the treaty encourages greater mobility of labour by removing impediments to work and accumulating superannuation benefits in both countries.
Trade Minister Simon Crean signed the new treaty in Paris last Friday.
"Australia and New Zealand continue to strengthen their economic links and move towards an integrated trans-Tasman economy under the Closer Economic Relations trade agreement and the Single Economic Market initiative," Mr Crean said in the joint statement.
"This treaty represents an important further step in those endeavours."
