School donations vary greatly between schools. Those in wealthy areas can charge more than $1000, while others charge less than $50 or nothing at all. There are often discounts for early payment or family rates.
Tristan Dean, chairman of the Board of Trustees at the decile 9 school, said it was the board's collective decision to provide the tags.
"They were not printed specifically as 'bag tags' for children, although this is obviously one possible way for them to be used, it's entirely up to the parent.
"There was never any intention to bully anyone or create different 'classes' of students based on those whose parents had paid a donation and those who hadn't, although I can understand why some parents see this as a concern."
Mr Dean said the school recognised that some families couldn't afford to pay a donation.
"It was always the intention that if any such families felt that they wanted a tag for any reason, they could confidentially contact anyone at the school and receive one, no questions asked.
"It is the significant number of families that choose not to pay the donation when they can afford to that we are really trying to encourage and we've tried all sorts of softer methods historically with very limited success."
One local resident told the Herald the policy had created a huge stir in opinion. She believed other local schools were using a similar system.
"Families come in various forms and from various backgrounds and not everyone can afford it, even if you do pay weekly.
"Why take this out on the kids? Just a suggestion but why don't the parents who paid, refuse to display the label."
Ministry of Education guidelines say schools can charge fees for take-home items, activities or events that enhance teaching of the curriculum, as long as parents are told beforehand and agree to pay.
Mr Dean said the board would be listening to feedback from parents on the tag scheme.
"Was the tag idea the right approach in trying to increase donation levels? Maybe not, and that is something we'll be looking at closely over the next few days."
Other schools, including Avondale College in Auckland, have put in place measures such as banning students from non-paying families from extra-curricular activities such as the school ball.
An earlier post on Whangaparaoa School's Facebook page outlined to parents why the donation was important.
"Like most other schools, we rely on your donations to help support the learning and improve the quality of resources that are available for your children.
"The latest funding figures show we are actually funded approx $843 LESS per student per year than a decile 1 school.
"Donations from parents help us make up a bit of this lack of funding, as do fundraising efforts by our wonderful PTA. Thank you for helping us to buy vital learning equipment."