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Goods and Services Tax Act 1985

Imposition of tax

11B: Zero-rating of some supplies by territorial authorities or water organisations, some supplies involving contributions to local authorities or water organisations

You could also call this:

"Some council services are tax-free if they're paid for in a special way or if land is exchanged."

Illustration for Goods and Services Tax Act 1985

If you are a territorial authority, you do not have to pay tax on some services you supply. This is because the money you get for these services comes from a special tax called the local authorities petroleum tax, which is paid to you under section 198 of the Local Government Act 1974. You can find more information about what a territorial authority is in the Local Government Act 2002. When a local authority or a water organisation supplies goods and services to someone who is registered for tax, they do not have to charge tax if the person is giving them land as part of the deal.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM83039.

Topics:
Money and consumer rights > TaxesGovernment and voting > Local councils
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"No tax on some phone and internet services"

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11C: Treatment of supplies by operators of loyalty programmes, or

"Tax rules for loyalty programmes that give rewards to customers"

Part 2Imposition of tax

11BZero-rating of some supplies by territorial authorities or water organisations, some supplies involving contributions to local authorities or water organisations

  1. A supply of services that is chargeable with tax under section 8 must be charged at the rate of 0% if the supplier is a territorial authority and the consideration for the supply is proceeds from the local authorities petroleum tax paid to the supplier under section 198 of the Local Government Act 1974.

  2. If a supply under section 5(7B) of goods and services by a local authority or a water organisation to a registered person is chargeable with tax under section 8, the supply must be charged at the rate of 0% to the extent that the contribution made by the registered person to the local authority or the water organisation consists of land.

  3. If a supply under section 5(7C) of goods and services by a person to a local authority or a water organisation is chargeable with tax under section 8, the supply must be charged at the rate of 0% if the local authority or the water organisation is a registered person.

  4. Repealed

  5. Repealed

  6. For the purpose of subsection (1)—

    local authorities petroleum tax is local authorities petroleum tax levied in accordance with Part 11 of the Local Government Act 1974

      territorial authority means a territorial authority within the meaning of the Local Government Act 2002.

      Notes
      • Section 11B: inserted, on (applying on and after 10 October 2000), by section 90(1) of the Taxation (GST and Miscellaneous Provisions) Act 2000 (2000 No 39).
      • Section 11B heading: amended, on , by section 32(1) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B heading: amended, on , by section 32(2) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B heading: amended, on , by section 151(1) of the Taxation (GST, Trans-Tasman Imputation and Miscellaneous Provisions) Act 2003 (2003 No 122).
      • Section 11B(1B): inserted, on (applying to contributions that are made on or after 25 November 2003), by section 151(2) of the Taxation (GST, Trans-Tasman Imputation and Miscellaneous Provisions) Act 2003 (2003 No 122).
      • Section 11B(1B): amended, on , by section 32(3) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B(1B): amended, on , by section 32(4) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B(1C): inserted, on (applying to contributions that are made on or after 25 November 2003), by section 151(2) of the Taxation (GST, Trans-Tasman Imputation and Miscellaneous Provisions) Act 2003 (2003 No 122).
      • Section 11B(1C): amended, on , by section 32(5) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B(1C): amended, on , by section 32(6) (and see section 32(7) for application) of the Local Government (Water Services) (Repeals and Amendments) Act 2025 (2025 No 43).
      • Section 11B(1D): repealed, on , by section 5(3) of the Affordable Housing: Enabling Territorial Authorities Act Repeal Act 2010 (2010 No 101).
      • Section 11B(1E): repealed, on , by section 5(3) of the Affordable Housing: Enabling Territorial Authorities Act Repeal Act 2010 (2010 No 101).
      • Section 11B(2) territorial authority: substituted, on , by section 262 of the Local Government Act 2002 (2002 No 84).