Wagga funeral homes question need for 'probably not relevant' death tax

The levy, announced in March, will increase internment fees for local governments across NSW, costs for cremations will now rise to $156 per burial, $63 per ash interment and $41 per cremation.

Daniel Woods from Daniel Woods Funeral Care said they will need to increase their services fee to account for the levy, even considering a change to their business model to avoid any financial issues.

"We have our own cremator, so we'll need to keep our own register and pay the levy as well, each cremation we do we'll have put that levy on," Mr Woods said.

"If you have a fee and you get something for it that's fine... all it's going to do is fund the department, the Department of Crematoria."

Scott Bance from Bance Funeral Services said the levy will lead to a cost increase for the cemetery and crematorium part of their services, but questioned the need for the levy.

"I can see why they're doing it, but it's probably not relevant," Mr Bance said.

"It's probably more people in the regional areas paying for something that the metropolitan areas need."

Local governments across NSW will start paying the levy from July 1, while smaller operators (under 50 internments) will have until July 1 next year before the it takes effect.

Acting director of infrastructure at Wagga City Council Henry Pavitt said the council is still learning about what the increased fees mean for the city, before they identify the best way to address the levy.

"We have fees that are publicly published, so everyone knows what our internment fees are," Mr Pavitt said.

"There's constant webinars at the moment about every Wednesday for us with Cemeteries Crematoria Association of NSW, trying to work out what this is going to mean."

Cemeteries and Crematoria NSW (CCNSW) say the levy will be used to regulate the industry and will be implemented as per a recommendation made in the Statutory Review of the Cemetries and Cremetoria Act.

However Local Government NSW have criticised the levy in a statement, calling it a death tax.

The body's president and Broken Hill councillor Darriea Turley labelling it as the latest example of cost-shifting by the state government.

"Across NSW, council cemeteries undertake more than 40 per cent of all burials, this rises to more than 80 per cent of all burials in rural and regional NSW," Ms Turley said.

"This unnecessary new tax will hit our rural and regional communities the hardest."