KEY POINTS:
Canberra will look at the issue of mutual recognition of dividend imputation and franking credits in its review of the tax system being led by Treasury Secretary Ken Henry, Treasurer Wayne Swan said yesterday.
New Zealand and Australia have a regime where shareholders can receive with their dividends tax credits which represent their share of the corporate tax their company has paid. But except under very limited circumstances the credits are of no use to investors on the other side of the Tasman.
Swan reaffirmed yesterday an undertaking by Australian Finance Minister Lindsay Tanner at the Australia New Zealand leadership Forum last month to look afresh at the issue of mutual recognition, after Finance Minister Minister Michael Cullen put it on the agenda.
"It has very substantial revenue implications," Swan said.
The two countries are also renegotiating their double agreement, a task they expect to complete by the end of the year.
