An article in the Christchurch Press of 1 August about Ngai Tahu claims that some profits from the iwi’s operations go to the tribal members in annual distributions and that the exemption from income tax benefits iwi members and not Ngai Tahu Property.
I beg to differ, as an analysis of the annual returns filed by the Ngai Tahu Charitable Group on the Charities Register tell a different story.
I suspect that the annual distributions are made by the Maori Authority that is a part of Ngai Tahu, with the Authority paying income tax at 17.5 cents in the dollar.
For the six years from 2009, when the Group first filed an Annual Return, to 2014 the Ngai Tahu Charitable Group distributed only $1.5 million by way of grants and donations, which is .11% of the Group’s gross income of $1.4 billion.
The Group has 33 limited liability trading companies which generated this income.
The Group made taxable net surpluses in 2010, 2012, 2013 and 2014 of $283 million on which the income tax at the company rate would be $80 million.
The Group also holds land valued at $172 million some of which no doubts attracts ratings concessions as well.
I would also be interested to know where the unexplained increase in the general accumulated funds of $200 million came from.
As a taxpayer subsidised charity the Group need to explain why they distribute so little, yet pay no income tax on their significant surpluses which gives them a competitive advantage in their trading activities, in order to justify their income tax exempt status.
An extract of the analysis can be seen below:
Dr Michael Gousmett FCIS PhD BCom(Hons) BBS Dip CM Dip Tchg is an Independent Researcher and Director of New Zealand Third Sector Enterprises Ltd: “Promoting Integrity in Non-profit Performance”.