New Zealand’s forest owners are calling for a cap on council rate increases after a forest block near Wairoa saw its annual rates bill jump by 570 per cent in a single year — a spike that has raised fresh doubts about the viability of new plantings.
The 1100‑hectare block, managed by agri‑advisory firm Lewis Tucker, was originally farmland before being purchased in 2019 and planted in radiata pine the following year. In July, the Wairoa District Council lifted the property’s annual rates from $30,000 to $200,000.
In a submission to the government’s local‑government reform programme, Lewis Tucker said that while it “broadly supported the intent to simplify local government,” limits on differential rating were now “critical for business confidence.”
Speaking to Radio New Zealand, Lewis Tucker, CEO Colin Jacobs said the increase amounts to an extra $5 million in rates over the life of the forest. “There’s been no reason given to us as to why a forestry company should pay such large differential rates,” he said. “What costs are we causing that justify that increased rate?”
Jacobs said the jump raises fundamental questions about whether the forest remains financially viable. “While there has been no explanation for the increase, the assumption is that the extra $5 million this property will now pay in rates over the life of the forest will go to pay for the impact of forestry on roads come harvest time.”
He also noted that the council applied the differential only to forests planted after 31 December 1989. “This suggests that the council’s concern is not the impact of forestry on roading, as a differential rate is being applied only to forests registered in the ETS.”
Wood Central understands the Wairoa District Council introduced new forestry differentials in 2022 following a review aimed at recognising the negative impacts of large‑scale forest conversion, including the hollowing‑out of rural communities. The Forest Owners Association challenged the changes in the High Court, but the Court of Appeal upheld the council’s approach.
According to Dr Elizabeth Heeg, CEO of the New Zealand Forest Owners Association, growers support a “soft cap” on differential rates. “Foresters just want to be a fair member of the community,” she said. “There are times when it’s appropriate to have differential rates, but having a differential where the rates are going up over 500 per cent is not fair.”
She said the association will propose a soft cap supported by stronger taxation principles. “We’ll be proposing a soft cap that is accompanied by the introduction of good taxation principles into local‑government legislation, to ensure that when councils are rating us, it’s based on an actual need in the community — and that it’s not just a differential that’s a secondary form of regulation.”
Wairoa District Council chief executive Matt Lawson said the increase reflected a change in land use. The property had previously been categorised as vacant forestry, but the 2024 Quotable Value revaluation reclassified it as exotic forestry.
Lawson said most of the economic benefits of forestry — “wages, profits and opportunities” — leave the district, while Wairoa is left to manage the impact of heavy logging trucks on rural roads.
Meanwhile, Local Government New Zealand has warned that a national cap on rates could undermine efforts to strengthen emergency management. LGNZ president Rehette Stoltz said that while the government has proposed exemptions for urgent or unforeseen situations, limiting councils’ ability to raise revenue could restrict proactive investment in risk reduction.
