Auckland Council - Independent Māori Statutory Board

Section YA 1 of the Income Tax 2007 and section 2(1) of the Goods and Services Tax Act 1985

The Income Tax Act 2007 and the Goods and Services Tax Act 1985 have been amended to treat the Auckland Council Independent Māori Statutory Board as a "local authority" for the purpose of those Acts. These amendments mean that the Board is treated in the same way as other advisory-type boards of the Auckland Council.

Background

Section 81 of the Local Government (Auckland Council) Act 2009 established the Board and set out its purposes. The purpose of the Board is to assist the Auckland Council to make decisions concerning the promotion of cultural, economic, environmental and social issues of significance to Māori, and to ensure that the Council acts in accordance with statutory provisions referring to the Treaty of Waitangi.

The Board is established as "a body corporate", separate from the Auckland Council. Consequently, the Board is a separate legal entity that can, and does, act in its own name, including in relation to the acquisition of supplies of goods and services required for its purpose and incurring expenditure in relation to such supplies. In contrast, the Pacific Peoples Advisory Panel and the Ethnic Peoples Advisory Panel established by the Mayor of Auckland Council are not separate legal entities. Their functions are carried out under the Auckland Council umbrella.

The amendments ensure that:

• The funding provided by Auckland Council to the Board is not subject to income tax. Local authorities are generally exempt from income tax under section CW 39 of the Income Tax Act 2007.
• The Board can register for GST purposes and claim back the GST content of expenses that it incurs in carrying out its functions. Local authorities are deemed to be carrying on a "taxable activity" under section 6(1)(b) of the Goods and Services Tax Act 1985.

Key features

The Auckland Council Independent Māori Statutory Board has been added to:

• the definition of "local authority" in section YA 1 of the Income Tax Act 2007; and
• the definition of "local authority" in section 2(1) of the Goods and Services Tax Act 1985.

Application date

The amendments apply from 1 November 2010, the date on which the Board was established.