* New skipper McCullum faces baptism of fire
* Vettori ruled out of South Africa tour (Adds Taylor quotes, details)
WELLINGTON, Dec 7 (Reuters) - New Zealand head to South Africa to take on the world's top-ranked test nation in tumult, with Ross Taylor sitting out of the two-match series after giving up the captaincy and Daniel Vettori ruled out with injury.
Taylor rejected an offer to keep the reins of the test team but step down as skipper of the Twenty20 and one-day sides, leaving opener Brendon McCullum to take on all three roles.
The announcement on Friday by New Zealand Cricket boss David White capped days of speculation about Taylor's future, with local media reporting a rift between head coach Mike Hesson and the 28-year-old batsman.
White confirmed Hesson was behind the move to depose Taylor from skippering the team in the shorter formats, part of a review following the tour of Sri Lanka where they drew a two-test series 1-1.
He added, however, that the coach's recommendation had the board's blessing.
"We regret that Ross Taylor has declined the opportunity, therefore McCullum has been appointed as Blackcaps captain for all three forms of the game," White told a news conference in Auckland.
"He thought about it long and hard and he said that he would like a break to spend time with his family and we've agreed to that and we respect it."
Taylor's decision to sit out the series robs New Zealand of their top test batsman and underlines the extent of the friction between the former captain and team management.
Taylor had scored 142 and 74 in a man-of-the-match performance to guide the Black Caps to a rare away win in the second test over Sri Lanka in Colombo, but local media were rife with reports of his removal throughout the week.
"It's not ideal and we would be a stronger team with Ross Taylor in it," said White, who expressed regret the saga had played out in local newspapers.
Taylor later issued a statement confirming that he had rejected the offer to stay on as test captain, citing concern that the split roles might prove "confusing" for the team.
"It has been a very challenging and pressured time and I don't believe I can give 100 per cent to the game at this time," he said. "Cricket is my life and my passion. But taking a break is the right thing for me right now.
"However, I want people to know that I am determined to contribute to the Black Caps team in the future and help whoever is in charge to win games of cricket for New Zealand."
Taylor's absence compounds the team's woes after fellow former skipper Vettori was ruled out of the tour to continue his recovery from a troublesome Achilles.
The 33-year-old all-rounder, New Zealand's most experienced player, hurt his foot at the World Twenty20 tournament in September, one of a string of injuries that have sidelined him from most of his team's schedule this year.
Uncapped 32-year-old Bruce Martin will head to South Africa as a specialist spinner in the absence of left-armer Vettori, with legspinner Todd Astle missing out.
BJ Watling has been picked as wicketkeeper in favour of Kruger van Wyk, while middle order batsman Dean Brownlie was also named in a 15-man squad released on Friday.
The 31-year-old McCullum has played 70 test matches at an average of 35.63 and 206 one-day internationals, and was in a two-horse race with Taylor to take over the captaincy when Vettori relinquished it in June last year.
McCullum faces a baptism of fire against South Africa, however, with a tough three-test home series against England to follow in March.
Taylor guided New Zealand to a breakthrough test win in Australia a year ago, but has been under pressure in 2012, his team beaten in test series defeats at home to South Africa and then away to the West Indies and India.
New Zealand play three T20 matches against the Proteas before the first test at Newlands in Cape Town from Jan. 2, 2013. (Reporting by Ian Ransom in Melbourne; Editing by Nick Mulvenney/Alastair Himmer)