Councils are being told to flush away toilet taxes and concentrate on ideas that support small businesses, not punish them.

Motel Association of New Zealand (MANZ) Chief Executive Michael Baines said toilet taxes are a senseless way of recovering a cost from the community.

He said councils tax commercial premises based on the number of toilets they have, which he says is discriminatory towards commercial accommodation providers..

He said the impact of toilet taxes are huge.

"Because it really does effect SME's (Small Medium Enterprises) the greatest and effectively a new tax of this nature and a toilet tax in particular only ever comes out of the pockets of the owner."

Baines said the idea of councils using toilet taxes stinks.

"To me it's a senseless way of recovering a cost from the community."