Inland Revenue calls out horticultural tax dodgers

Author: RNZ,
Publish Date: Thu, 6 Aug 2026, 4:00pm

Inland Revenue says it has identified several horticultural sector practices that threaten the tax system's integrity. Photo / RNZ

Inland Revenue is warning it’s cracking down on dodgy practices in the horticultural sector.

The department said it had identified several prevalent practices in horticulture that threatened the integrity of the tax system, including staff being paid cash or complex arrangements being used to obscure what was happening.

It has issued a revenue alert about the non-compliance.

These are issued infrequently by the department’s commissioner when there are significant or emergency areas of concern.

Inland Revenue said it was stepping up its focus on growers, contractors and subcontractors.

It said it was aware of situations where false invoices were created to obscure the true nature of transactions, and this could lead to people and businesses paying less in GST, PAYE and other income tax than they should.

When this was happening, it said it would look to amend tax assessments, but prosecution was also an option.

Inland Revenue is increasing its scrutiny of new applications for GST registration by entities in the horticultural sector.

This includes companies that may have been set up for the sole purpose of issuing false invoices.

If an entity isn’t carrying on a taxable activity, its GST registration application will be declined.

Inland Revenue is also looking at non-compliance with schedular payment obligations and at the use of certificates of exemption and tailored tax rates by taxpayers in the sector.

It is increasing action taken to pursue outstanding debt in the sector and will use a range of powers to collect this debt.

Inland Revenue is also concerned about broader non-compliance with GST, PAYE and income tax obligations in relation to the supply of labour in horticulture.

If evidence of non-tax offending by a taxpayer in the sector is identified, Inland Revenue will consider whether information may be shared with other government regulators/enforcement agencies such as police and the Labour Inspectorate/Ministry of Business, Innovation and Employment (MBIE).

In the year to June 30, 2026, Inland Revenue opened around 130 investigations into horticulture businesses, involving $7.2 million in discrepancies.

Forty-five cases are still open.

Three people involved in the sector were sentenced to home detention during the year on tax evasion charges.

-RNZ