Breeding Exemption On GST Boon To Racing Industry

16 March 2007

Breeding Exemption On Gst Boon To Racing Industry

The decision to allow race horses sold for export to remain in New Zealand for a period of up to two years without attracting GST will stimulate investment in New Zealand horses from overseas owners claims New Zealand Racing Board Chairman Michael Stiassny.

In conjunction with other Industry participants the Racing Board made the submission to the Inland Revenue in June last year requesting that the period of exemption be extended from 12 to 24 months. Racing Minister Winston Peters had advocated strongly for this extension.

“The submission we made to the Commissioner was extremely thorough, thanks in a large part to information and support provided by New Zealand Thoroughbred Breeders Association and New Zealand Bloodstock, while both equine Code bodies were also involved in consultation,” Mr Stiassny said.

New Zealand-bred Thoroughbred racehorses have been building an impressive record in Hong Kong and Malaysia/Singapore. This exemption will increase the attractiveness of New Zealand horses to Asian buyers who see real benefits in leaving them in the New Zealand environment for a period of longer than the 12 months currently exempt from GST.

“This decision benefits the whole racing industry as we all know how important it is to see New Zealand bred and trained horses competing on the international stage. We’ve always believed we have a natural advantage in breeding horses. This exemption provides us with the opportunity to offer foreign buyers a more complete package where the animals have been fully prepared in New Zealand’s superior conditions before they leave our shores,” said Mr Stiassny.

While goods sold for export are generally exempt of GST as long as they leave the country in 28 days, the Commissioner of Revenue has the discretion to extend the period if there are special circumstances. Until now, the GST-exemption period for the racing industry has been 12 months.

In 2004/2005 over 2500 horses were exported with a value of almost $140 million.

ENDS

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