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Rating Act Change Fair And Logical

“The profound impact of little bits of legislation on a small number of people often passes largely unnoticed by the media and therefore the public, and the MP concerned is left unrecognised for doing something good and sensible,” said Joy Quigley, Executive Director of Independent Schools of NZ.

“But NZ First MP Hon Brian Donnelly gained total Parliamentary support to correct a rating exemption anomaly that he spotted in the Local Government (Rating) Act and not-for-profit independent schools are extremely grateful to him.”

Prior to Mr Donnelly’s amendment being passed independent schools had to pay rates on all property over 1.62 hectares (4 acres) but state and integrated schools were exempt.

The new law continues the provision for rates exemption for state and integrated schools (even though the latter own their own property and receive a state subsidy to assist with capital development and maintenance) and extends it to not-for-profit independent schools and early childhood centres.

“In reality most pre-schools are below the 1.62 ha size and some territorial authorities did exempt independent schools because of their charitable and church-related status. However other councils have charged not-for-profit independent schools at the same time as exempting nearby state or integrated schools,” said Ms Quigley. “This was not only illogical, it was unfair as all not-for-profit schools should be treated the same for rating purposes.”

As Mr Donnelly said when he reported on the passing of the legislation “the vast majority of parents who send their children to private schools are not dripping in wealth. And yet they have to pay their taxes to the government, the government pays only 30% of the running costs of the schools, the parents have to pay fees for the rest, have to pay GST on those fees, then they’re socked for local taxes through rates, and if that’s not enough, they have to pay GST on their rates.”

“The situation is blatantly unfair and it took New Zealand First to recognise it and do something about it,” said Mr Donnelly.

ISNZ is very grateful to Hon Brian Donnelly for recognising that this rating unfairness should be rectified and thanks him for working so hard to get the necessary cross-Parliamentary support. The legislation comes into effect 1 July 2003.

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