Gift duty in New Zealand will be no more from October 1 this year.
Parliament last night passed the Taxation (Tax Administration and Remedial Matters) Bill into law under urgency as the November 26 election looms.
Labour and the Greens held a minority view opposing the abolition of gift duty, saying there was not enough evidence to show the move would not increase the use of trusts.
But the majority view of the select committee was a Law Commission review into trust law would handle the issue of trust use, and that gift duty was not the appropriate way to handle inadequacies in trust law.
"This bill proposes to abolish gift duty from 1 October 2011. Gift duty raises the Government about NZ$1 million a year, but costs NZ$430,000 in administration, and costs the private sector an estimated NZ$70 million in compliance each year," the FEC said in its report.