Dr Michael Gousmett: Taxing Non-related Large-scale Trading by Charities - correcting an unintended consequence

Recent letters to the Press have asked the question, why do trading operations undertaken by Ngai Tahu have charitable status, therefore are exempt from income tax?  As a charity specialist I always reply to such letters but the Press in exercising its editorial discretion does not always see fit for whatever reason to publish my informed responses. 

The latest letter, on 25 June by John Burn, pointed out that no doubt property developers and agricultural commercial rivals would be aggrieved at the fact that Ngai Tahu pays no income tax on its trading activities, the basis of which are public assets gifted by the government which now allows Ngai Tahu to build a huge corpus.  Mr Burn is quite right about the growth of Ngai Tahu’s trading activities and my response to the Press explained how that growth is occurring.

Mike Butler: Tribal charity review needed

Ngai Tahu chair Mark Solomon tried to deflect criticisms of lack of accountability around businesses posing as charities, of individuals being paid too much, and that too little was being distributed. Since the tax tribal corporations are excused paying is enormous, and since there is an expectation in the public's mind that tribal businesses will pay their fair share and compete on a level playing field, a review of the tax treatment of treaty settlements and tribal charitites is urgently needed.