13 Jan 2004

New Zealand opposition wants to make Niue reconstruction conditional on tax status

12:04 pm on 13 January 2004

The New Zealand opposition ACT Party is urging the government to probe Niue's status as a tax haven before spending tens of millions of dollars on rebuilding the cyclone stricken island.

ACT's associate commerce spokesman, Stephen Franks, says Niue's status as a tax haven has been a thorn in the side for both New Zealand and the OECD for years.

Niue has said it will help reduce tax fraud.

However, Mr Franks says the government needs to seek some assurances from Niue before making long term commitments to help.

"There is going to be infrastructure requirements there and I think it is perfectly fair for New Zealand taxpayers to say hang on a minute. At least before we commit to that long-term stuff after the immediate humanitarian help has been given we need to know that they are not ripping off our tax base."

Meanwhile, the foreign minister Phil Goff has described Mr Franks's position as unfortunate.

Mr Franks needs to get his facts straight. Niue has never been a problem as a tax haven in the sense other countries in the Pacific have. I think it is most unfortunate that the best support that Mr Franks can offer at this time is to attack a country that already is the victim of a tragedy of this scale.