10 Jul 2009

New Zealand PM ends Pacific tour

5:32 pm on 10 July 2009

The New Zealand Prime Minister John Key has ended his goodwill tour of the Pacific by signing a tax evasion agreement with the Cook Islands.

The Tax Information Exchange Agreement will allow New Zealand to access information in the Cook Islands if it believes tax evasion is occurring.

Mr Key says the agreement is part of international efforts to strengthen cooperation in this area

He says it will prevent a replay of the winebox saga of the 1990s in which New Zealand firms used Cook Islands to dodge tax.

"Anyone who was trying to get around the law will now be aware that information under the right circumstances may be sourced by the New Zealand authorities. But I think from the Cook Islands perspective, they've been willing signatories to this document. They are intending to sign others and I think its just a reflection of the fact that they also want to have integrity in their financial system."

John Key has also agreed to financially back Air New Zealand flights to the Cook Islands.