'Silly' inconsistency: Police pay council rates while schools, hospitals and churches don't

Police received half a billion dollars in the Budget including a $120 million boost to meet cost pressures, including the cost of local council rates.

While schools, hospitals and churches are exempt from paying rates, Police are not - an inconsistency that's been described as "silly".

It may come as a surprise to you that land used for public swimming baths is exempt from paying local council rates. State schools are exempt too. So are places of religious worship.

But, not the police - who say the cost of rates, utilities and maintenance has increased by $17 million this financial year.

"They aren't funded properly and need a cash injection just to see them through this financial year," said NZ Police Association vice-president Paul Ormerod.

Police received a one-off top-up of $120 million in Budget 2024 to fund what's described as critical cost pressures.

The extra cash will cover the rising cost of things like fuel and vehicle maintenance and the rising cost of local council rates.

The latter is because Police are not included in a local government law that exempts some landowners like bathhouses, hospitals, schools, marae, and churches.

"To have some paying rates and a whole lot of exclusions, while others such as the Police are, is a bit silly," said Taxpayers' Union executive director Jordan Williams.

Massey University Emeritus History Professor and religious scholar Peter Lineham said there is a case for making churches pay rates.

"I think you could argue very reasonably that all buildings should pay some sort of rates because all buildings in a city get some services from the city," he said.

But that's not the only inconsistency on the Taxpayers' Union's radar.

"There are clearly some issues around churches with not just rates but income tax, for example," Williams said.

"They're charitable bodies, nobody gets the profits from the churches, it's simply ploughed back into the operation, so there's nothing really to tax," Prof Lineham added.

In April, Prime Minister Christopher Luxon said he'd look at changing the income-tax exemption status of churches this term.

"Yeah, we'll certainly be looking at things like that this term, yup," he said at the time.

But it wasn't included in the Budget, so when?

"We've got 36 actions to get done by the 30th of June. We did that first 100 days. We've got a lot of things to consider but we're just working our way through that, it hasn't been a topic of conversation," Luxon said.

Others clearly are having the conversation about why our Police are paying taxes and rates when churches are not.