GST rates in New Zealand
New Zealand's Goods and Services Tax is 15% and applies to almost everything. GST here is deliberately broad: unlike most VAT systems there is no reduced rate for food, books, children's clothing or domestic energy. Groceries carry the same 15% as a television. That breadth is the defining feature of the New Zealand system and the reason its GST raises so much relative to its rate.
| Rate | Applies to |
|---|---|
| 15% | Standard rate — almost all goods and services supplied in New Zealand |
Inland Revenue's tax fraction: three twenty-thirds
Because GST is charged on the net price, the tax sitting inside a GST-inclusive price is not 15% of that price. Inland Revenue publishes the exact figure to use: the tax fraction is 3/23 — the rate divided by 100 plus the rate.
IRD's own worked example: on a $115 GST-inclusive total, multiply by 3 and divide by 23 to get $15 of GST, leaving $100 net. Taking 15% of $115 instead gives $17.25, which is $2.25 too much on a single small invoice.
The fraction is also the reason a GST-registered business quoting "plus GST" and one quoting a GST-inclusive price are not making the same offer. $100 plus GST is $115. $100 including GST is $86.96 plus $13.04. Both are legal, both are common, and the difference is real money — always check which one a quote means before comparing it with another.
Adding GST
To add GST to a net (pre-tax) price at the standard rate: gross = net × 1.15. The GST is 15% of the net amount.
Removing GST
To find the GST already inside a gross (GST-inclusive) price: net = gross ÷ 1.15, then GST = gross − net. Equivalently, the GST is 15 ⁄ 115 of the gross — which is Inland Revenue's published tax fraction, 3/23.
Frequently asked questions
What is the New Zealand GST rate?
The standard rate is 15%. GST rose from 12.5% to 15% on 1 October 2010 and has been 15% since.
Why is 15% of the gross price the wrong answer?
Because GST is charged on the net price, not on the total. On a $100 gross amount at 15%, the GST is $13.04, not $15.00 — the net is $86.96. Use the "Remove GST" mode above and the calculator does it for you.
Is any supply GST-free in New Zealand?
A small number: exported goods and services are zero-rated, and financial services and residential rent are exempt. There is no reduced rate for food — this is unusual internationally and is a deliberate design choice to keep the system broad and simple.
More New Zealand calculators
This calculator uses GST rates published by Inland Revenue and is for general information only — it is not tax advice. Some supplies are zero-rated or exempt and are not covered here. Rates read from Inland Revenue.