New Zealand intends to introduce legislation for a digital services tax on large multinational companies starting in 2025. This decision came after talks for a global rollout at the Organization for Economic Cooperation and Development (OECD) failed to reach a consensus. The proposed tax will specifically target multinational businesses earning income from New Zealand users of social media platforms, search engines, and online marketplaces.
Companies making over 750 million euros ($812 million) annually from global digital services and over NZ$3.5 million annually from services provided to New Zealand users will be liable for the tax. The tax rate will be set at 3% on gross taxable New Zealand digital services revenue, following the lead of comparable countries such as France and the United Kingdom. The legislation is expected to yield NZ$222 million over four years. The bill will be introduced to the parliament on Thursday.