The government decided to pay for the war by confiscating land, including the 500,000 hectares that it had occupied in Waikato. This was all possible under the terms of the 1863 New Zealand Settlements Act. Grey had also signalled such consequences with his ultimatum issued on the eve of the invasion of Waikato in July 1863. Māori had been warned that in acting against the Crown they would forfeit the ‘right to the possession of their lands guaranteed to them by the Treaty of Waitangi’.
The land confiscated included most of the lower Waikato district, including some of the lands of neutral tribes and a third of the lands of Ngāti Hauā. Māori called this the Raupatu. Ironically, Ngāti Maniapoto regarded as the more militant iwi largely escaped the confiscation. Their land was hard to access and was not considered to be as valuable. For supporters of the King this confirmed their suspicions that the war had been about acquiring the fertile lands closest to Auckland for settlement.
Tāwhiao declared that the fighting should end. Those promoting war in response to the Raupatu were increasingly isolated within the movement. In proclaiming an isolationist policy Tāwhiao forbade a number of activities within his dominion, including the surveying and selling of land, the operations of the Native Land Court and Māori assessors, the levying of rates, the building of roads and telegraph lines, and gold prospecting.
Although he had rejected war, Tāwhiao refused to make peace with the government until all confiscated lands were returned.
In 1862 the Taranaki leader Te Ua Haumēne developed a new religion based on the principle of pai mārire (goodness and peace). Te Ua called his church Hauhau after Te Hau (the breath of God) that carried the news of deliverance to the faithful.
This faith grew out of the conflict over land in Taranaki. It was the first organised expression of an independent Māori Christianity. The terms Pai Mārire and Hauhau became interchangeable as labels for those who followed this religion.
In 1862 Te Ua had a vision of the archangel Gabriel, who instructed him to lead his people in 'casting off the yoke of the Pākehā'. The birthright of Israelites (the Māori people) would be restored in the land of Canaan (New Zealand), and following a day of deliverance the unrighteous would perish.
Pai Mārire disciples travelled around the North Island between 1864 and 1867 and attracted many converts, especially as confiscation of land increased in the aftermath of the wars. Against a backdrop of war and land confiscations, the founding principle of Pai Mārire was often subverted by violent elements. While some of its members stressed the need for peace, Pai Mārire became drawn into armed conflicts. Civil wars broke out as factions within iwi opposed the spread of the new religion.
Some Pai Mārire converts aimed to drive Pākehā from Māori land and believed a Māori nation could be created under Tāwhiao's leadership. Settlers feared a general uprising, but Tāwhiao, a convert since 1864, rejected the violence associated with the spread of Pai Mārire. In 1867 he declared that 'the sword was sheathed' and remained firmly committed to peace. In 1868, when the campaigns of Titokowaru and Te Kooti erupted, Tāwhiao supported neither. He refused to grant Te Kooti sanctuary in the King Country until he too 'sheathed his sword'.
Between 1875 and 1876 the Kīngitanga modified its religious expression when it adopted the Tariao (Morning Star) faith. This combined Pai Mārire prayers with new forms of ritual. The Tariao were ministers of the new faith; Tāwhiao, as the head Tariao, communicated with them in a series of panuitanga (announcements), calling on them to obey a list of rules that once again banned roads, telegraphs, surveys, land selling, as well as some older Māori customs. These included taua muru (punishing raids), the use of tohunga (priests) for cursing enemies and the imposition of tapu.