New Zealand plans public consultation on GST reform for thoroughbred breeders
The racing minister aims to reduce compliance costs for bloodstock investors.
New Zealand.- Winston Peters, deputy prime minister and racing minister of New Zealand, has announced a public consultation on GST policy proposals aimed at enhancing competitiveness in the racing sector.
Bloodstock breeders frequently collaborate in joint ventures to invest in thoroughbreds, assisting with both the initial purchase costs and ongoing expenses. Peters noted that it is a common practice among joint venture participants, including breeders, to claim GST deductions individually on their respective GST returns. However, Inland Revenue has determined that the existing regulations do not permit this
He said: “The racing industry makes an important economic contribution. New Zealand thoroughbreds are in demand overseas as racehorses and for breeding. The domestic thoroughbred industry put nearly a billion dollars into the economy in 2022/23.”.
He added: “Breeders would incur the compliance cost of registering and filing GST returns for each horse separately every month or every two months. The government is proposing to take a pragmatic approach and avoid imposing compliance costs by allowing current practice. If this proposal proceeds, it will place the New Zealand industry on a more equal footing with the Australian industry.”
The consultation document will be released in the upcoming months on taxpolicy.ird.govt.nz.
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TAB NZ has issued a press release welcoming the government’s proposed adjustments. Jason Fleming, TAB NZ general manager, said: “New Zealand breeds some of the best thoroughbred and standardbred horses on the planet. We are pleased the government understands the challenges facing investors and is willing to consider practical assistance to ensure the bloodstock industry can continue to grow and further its contribution to our economy.”
According to TAB NZ, bloodstock breeding adds nearly NZ$400m (US$228m) to New Zealand’s economy. This is part of the NZ$1.9bn (US$1.08bn) total from the racing industry. A large number of foals are sold overseas each year, which helps boost the country’s export earnings.
The breeding industry has faced serious challenges. From 2003 to 2023, the number of foals produced decreased by 42 per cent, dropping from 5,156 to 2,972. As a result, the number of trained horses fell by 36 per cent, from 8,983 to 5,732.
Nick Johnson, New Zealand Thoroughbred Breeders’ Association CEO, said: “The New Zealand thoroughbred breeding industry is deeply rooted in the country’s heritage and economy yet has faced contraction in the foal crop over the last 15 years. To stabilise and grow this vital industry, attracting new investment and supportive policies are essential—not just to sustain domestic racing, but to elevate New Zealand’s global racing reputation and economic impact.”
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