In 1939, Māori authorities were created to act as trustees in order to administer communally-owned Māori property on behalf of individual members.
Today, a Māori authority must manage or administer assets held in common ownership. These entities may be trustees of trusts or companies.
In 1952 a Commission of Inquiry recommended that the tax rules surrounding the Māori authorities be updated to ensure fairer taxation. In August 2001 the government released the discussion document "Taxation of Māori Organisations" which contained policy options for modernising the tax rules for Māori authorities.
Legislation was passed in 2003 to introduce new rules that apply to the taxation of Māori authorities. The new legislation became effective from the 2004/05 income year and replaced the existing tax rules governing Māori authorities.
All Māori organisations wanting to take advantage of the Māori authority tax rules, including the tax rate of 17.5%, must meet the qualifying criteria and elect into the system.
Your organisation will need to weigh the advantages and disadvantages before deciding whether to elect into the Māori authority system.
Some of the advantages to becoming a Māori authority are:
Some of the disadvantages of becoming a Māori authority are: