The general assumption that it's the same as Australia is not correct.
When a global payments giant opens a local office, it is not merely a business decision — it is a declaration that a market has matured enough to deserve its own story. Stripe's 26% revenue surge in New Zealand following its late-2024 office launch reflects both the country's distinctive cross-border commerce culture and the company's calculated bet on localisation. Yet growth at scale invites scrutiny, and tax advocates are now asking whether the financial architecture connecting Stripe's New Zealand operation to its Irish parent honours the spirit — and the letter — of local tax law. The question is one that echoes across the digital economy: when value is created in one place and profits flow to another, who decides what is owed, and to whom?
- Stripe's New Zealand revenue leapt 26% in a single year after the company stopped treating the country as an extension of Australia and hired dedicated local leadership.
- The company's payroll more than tripled — from $536,000 to $2.1 million — signalling a serious, sustained commitment rather than a token regional presence.
- Tax Justice Aotearoa is pressing Stripe to justify whether its 'reseller fees' to its Irish parent are effectively royalties that should attract withholding tax under New Zealand law.
- Stripe has not responded to questions about its transfer pricing methodology, continuing a pattern in which major tech firms deflect detailed scrutiny of cross-border profit allocation.
- New Zealand's unusually high rate of cross-border sellers — 40% of Stripe's local customers, versus 30% in Australia — gives the company both a compelling market story and a reason to deepen its investment here.
Stripe, the Irish-founded payments processor valued at $159 billion, made a deliberate bet on New Zealand when it opened a dedicated local office in late 2024 — and the numbers suggest the bet is paying off. Revenue grew 26% in the year that followed, and the company's local payroll swelled from $536,000 to $2.1 million as it brought on talent to serve what managing director Karl Durrance described as a fundamentally different market from Australia. To lead the operation, Stripe hired Ben Hanna, a former Soul Machines executive, signalling that the company intended to build something distinct rather than simply replicate its Australian playbook.
The commercial logic is clear. Forty percent of Stripe's New Zealand customers conduct cross-border selling — nearly double Australia's 30% and well above the global average. The company's pitch to these merchants rests on currency flexibility, real-time adaptive conversion it says lifts sales by an average of 11.9%, and simple flat-rate pricing with no setup or monthly fees.
But growth has brought scrutiny. Tax Justice Aotearoa member Nick Miller, a former senior EY manager, argues that the 'reseller fees' Stripe pays to its Irish parent closely resemble royalties that should be subject to withholding tax under New Zealand law — the same question he has raised with Google, Facebook, and AWS, receiving no substantive answers. Stripe did not respond to questions about its transfer pricing methodology. A tax expert at Auckland University noted that the OECD's new global minimum tax framework, which took effect in January 2025, will not change what tech firms pay in New Zealand, since the country's corporate rate already exceeds the 15% threshold.
Founded in 2010 by brothers Patrick and John Collison, Stripe remains privately held despite persistent IPO speculation. In February, it offered employee stock at a $159 billion valuation — nearly triple its 2021 level. As the company deepens its New Zealand footprint, it carries with it the same unresolved questions about profit allocation that have followed the broader tech sector across the country.
Stripe, the Irish-founded payments processor now valued at $159 billion, has tightened its grip on New Zealand's merchant economy since opening a dedicated local office in late 2024. The move paid off immediately: revenue jumped 26% in the year that followed, while the company's payroll swelled from $536,000 to $2.1 million as it hired local talent to manage what executives describe as a fundamentally different market from Australia.
But the growth has drawn scrutiny from tax advocates who question whether Stripe's financial structure in New Zealand complies with local tax law. The company pays what it calls a "reseller fee" to its Irish parent company—a practice that mirrors arrangements used by Google, Facebook, and Amazon Web Services. Nick Miller, a Tax Justice Aotearoa member and former senior manager at EY in Britain, argues the fee looks suspiciously like a royalty payment that should be subject to withholding tax under New Zealand law. "Even if it can be justified as an arm's length amount, it is likely in substance to be a royalty to which withholding tax should be applied," Miller said. He has posed the same questions to AWS, Tesla, and others, receiving no substantive responses.
Strike's New Zealand accounts note there was "no material impact" from the OECD's Pillar Two global minimum tax framework, which took effect on January 1, 2025. The rule requires multinationals to pay at least 15% tax globally. But as Victoria Plekhanova, a tax expert at Auckland University, explained to the Herald, Pillar Two won't change what Big Tech firms report or pay in New Zealand because the country's corporate tax rate already exceeds 15%. The framework simply doesn't apply here.
Still, Miller wants a detailed breakdown of Stripe's cost of sales. The company did not immediately respond to questions about its transfer pricing methodology. The tax advocate's persistence reflects a broader pattern: major tech firms operating in New Zealand have largely avoided detailed public discussion of how they allocate profits and costs across jurisdictions.
Strike's local expansion was deliberate. Karl Durrance, the company's managing director for Australia and New Zealand, announced the office opening by emphasizing that New Zealand required its own strategy. The company hired Ben Hanna, a former Soul Machines executive, to lead the operation. "The general assumption that it's the same as Australia is not correct," Durrance said. "This is going to give us a chance to get that level of fidelity so that we can invest in New Zealand in a different way to meet the needs of merchants there."
That localization makes sense given the data. Forty percent of Stripe's New Zealand customers, measured by transaction volume, conduct cross-border selling—nearly double the 30% figure for Australia and far above the global average. Stripe's pitch to these merchants centers on currency conversion and payment flexibility. The company offers real-time adaptive conversion that it says lifts sales by an average of 11.9%. It also provides point-of-sale terminals and Tap to Pay functionality for iPhones, allowing customers to pay by tapping their card or digital wallet without additional hardware. The pricing is straightforward: 2.7% plus 30 cents for domestic card payments, 3.7% plus 30 cents for international transactions, with no setup or monthly fees.
Strike was founded in 2010 by Irish brothers Patrick and John Collison, who still run the company. It remains privately held despite years of IPO speculation. Last year, Patrick Collison told the Herald there were no plans or need to go public. In February, the company offered stock to employees at a $159 billion valuation, nearly triple its 2021 level. The Collisons have built a global business by solving a specific problem: making it easy for merchants anywhere to accept payments from anywhere else. But as Stripe deepens its New Zealand footprint, it faces the same tax questions that have dogged other tech giants operating in the country.
Notable Quotes
Even if it can be justified as an arm's length amount, it is likely in substance to be a royalty to which withholding tax should be applied.— Nick Miller, Tax Justice Aotearoa
This is going to give us a chance to get that level of fidelity so that we can invest in New Zealand in a different way to meet the needs of merchants there.— Karl Durrance, Stripe Australia New Zealand managing director
The Hearth Conversation Another angle on the story
Why did Stripe suddenly decide to open a physical office in New Zealand when they'd been operating remotely before?
They saw the market was different from Australia in ways that mattered. Forty percent of their New Zealand customers sell across borders—that's unusually high. They needed someone on the ground who understood local merchants, not just someone managing the region from Sydney.
And the tax issue—is Stripe actually breaking the law, or is this just aggressive tax planning?
That's the question Miller is asking. The "reseller fee" to the Irish parent might be perfectly legal if it's an arm's length price. But Miller thinks it's really a royalty in disguise, which would trigger withholding tax obligations. Stripe hasn't publicly addressed it.
Why does Pillar Two not apply here?
Because New Zealand's corporate tax rate is already 15%. Pillar Two only kicks in for countries below that threshold. It's a quirk of the rule—countries with higher rates don't benefit from it.
What does Stripe actually do for these merchants that justifies the fees?
They handle the complexity. Real-time currency conversion, fraud prevention, multiple payment methods, point-of-sale systems. For a merchant selling globally, that's valuable infrastructure. The fees reflect what Stripe says are real costs—FX spreads, payment method handling, fraud prevention.
Is there any chance this tax scrutiny will change how Stripe operates?
Not immediately. The company hasn't responded to Miller's questions, and there's no indication of regulatory action. But as tax authorities globally focus more on transfer pricing, Stripe and others like it will face increasing pressure to justify their structures publicly.