Bruce Sheppard confirms Trinity scheme participation

12.30pm

New Zealand Shareholders' Association chairman Bruce Sheppard today admitted he was a participant in the controversial Trinity tax scheme.

Following a report in the National Business Review today Mr Sheppard confirmed he was an investor in the scheme.

Mr Sheppard said his involvement in the scheme was currently before the Taxation Review Authority but he was not one of a group of prominent people currently contesting tax avoidance charges with the Inland Revenue Department in the High Court.

Mr Sheppard said he had offered his resignation to the association's board, but they had declined it.

He said he would continue as the association's chairman, "so long as I've got the executive board's support".

"If my other activities become a difficulty for the association then of course I'll move on."

Mr Sheppard said with his case now before the Taxation Review Authority (TRA), he had absolute confidentiality. "At the end of the day I didn't have to come out of the cupboard."

The authority hears cases in secret and though its decisions are publicly available, taxpayers are not identified.

"But I have been troubled for some time by the stance that we take publicly being reconciled with the actions I take privately," Mr Sheppard said.

"So I've fixed it."

He said he didn't believe he had done anything wrong "it's simply an investment and I have lots and lots and lots of investments."

But he was not surprised the IRD had audited the scheme, "and I expected them to be robust in their audit".

Nevertheless, he said he was surprised by the allegations of tax avoidance.

He also said his involvement in the scheme differed from that of those battling the IRD in the High Court in that he had not participated in the scheme's insurance arrangements.

The Trinity scheme involved contentious insurance and licence payments linked to a venture to grow a douglas fir forest in Southland.

Investors could have claimed up to $3.7 billion over 50 years but legislation blocked the scheme from the current tax year.

According to a previous court judgment, 200 Trinity investors claimed tax advantages of $70 million a year from 1998.

The plaintiffs in the case currently before the High Court at Auckland are the taxpayers - fighting to avoid paying Inland Revenue assessments.

Another 300 cases are waiting at the Tax Review Authority, pending the High Court decision.

The High Court plaintiffs have also been fighting to keep their identities secret.

The Court of Appeal at Wellington earlier this month reserved its decision on an appeal by the taxpayers to have their names suppressed.

- NZPA