WELLINGTON, Aug. 13 (Xinhua) -- New Zealand's ability to detect and prevent tax evasion is enhanced by an update to the country's double tax agreement with China's Hong Kong Special Administrative Region which is now in force, Revenue Minister Stuart Nash said on Monday.

The update to the 2010 double tax agreement (DTA) removes an impediment to the automatic exchange of information (AEOI) between the two tax jurisdictions, Nash said in a statement.

"The double tax agreement with Hong Kong is one of 40 such tax treaties with our main trading and investment partners," Nash said, adding they encourage growth in economic ties by reducing tax impediments to cross-border trade and investment.

DTAs provide greater certainty of tax treatment, eliminate double taxation, reduce withholding taxes on cross-border investment returns, and exempt certain short-term activities from income tax, he said, adding they also enable New Zealand and Hong Kong tax officials to help each other to detect and prevent tax avoidance and evasion.

"The AEOI initiative is an international response to mounting concerns with the problem of off-shore tax evasion, that is, the ability of individuals and entities to evade tax by hiding their wealth in off-shore accounts," the minister said.