Westpac loses tax ruling
(8 October 2009 – New Zealand) Westpac is facing a significant tax bill after a New Zealand commission ruled against the bank on four tax transactions.
A decision was made public today on the ruling of the High Court of New Zealand regarding Westpac Banking Corporation (Westpac) tax assessments for nine structured finance transactions undertaken between 1998 and 2002.
The High Court found in favour of the Commissioner of Inland Revenue (CIR) New Zealand on four representative transactions.
When taking into account all of the nine transactions the financial cost of the judgment would be NZ$918 million (A$753 million), made up of core tax of NZ$586 million and interest of NZ$332 million (all as at 30 September 2009).
George Frazis, chief executive officer, Westpac New Zealand said that the length of the trial, the time taken to consider arguments, and the time taken to get to this stage, clearly demonstrates the complexity of the issues being contested by the bank.
Mr Frazis, added, the bank has always believed that the transactions were commercially justified and complied with the law, and thus is very disappointed with this decision.
Westpac would take time to go through the details of the judgment and would be considering an appeal, Mr Frazis concluded.
The bank has made it clear that the judgment will not impact their day to day operations in anyway.
The High Court found in favour of the Commissioner of Inland Revenue (CIR) New Zealand on four representative transactions.
When taking into account all of the nine transactions the financial cost of the judgment would be NZ$918 million (A$753 million), made up of core tax of NZ$586 million and interest of NZ$332 million (all as at 30 September 2009).
George Frazis, chief executive officer, Westpac New Zealand said that the length of the trial, the time taken to consider arguments, and the time taken to get to this stage, clearly demonstrates the complexity of the issues being contested by the bank.
Mr Frazis, added, the bank has always believed that the transactions were commercially justified and complied with the law, and thus is very disappointed with this decision.
Westpac would take time to go through the details of the judgment and would be considering an appeal, Mr Frazis concluded.
The bank has made it clear that the judgment will not impact their day to day operations in anyway.
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