Police say this case is believed to be the oldest cold case to end in an arrest.
Mr Tahu's killing shocked the Turangi community. He was found by a passing motorist lying in a pool of his own blood next to a petrol pump in the forecourt of the service station.
He had gunshot wounds to his head and shoulder and was rushed to Taumarunui Hospital, but died a few hours later.
In the days after the shooting, police tracked and surrounded an armed motorist who shot himself, but survived his injuries. Police said at the time that shooting was linked to the murder case.
Eventually, a man was charged but the case was later dropped because of insufficient evidence.
News of the latest arrest came as a relief to Mr Ormsby, who said many people had been waiting a long time to see justice done.
He said Mr Tahu was a popular man and police officers knew him well because they would fill up their police cars at the service station where he worked.
"A few of us old cops would have been sitting around the breakfast table today smiling. Here's hoping there will be closure. I will be keeping my fingers crossed."
Mr Ormsby said the police officers on the case now deserved a pat on the back.
"I take my hat off to them for opening the file and keeping on track and bringing this good result."
Turangi local Anton Bryant told The Daily Post yesterday news of the arrest was on everyone's lips in the town. "Everyone is really pleased this has come to this after all this time.
"We knew Rod well. He was well respected in the town and was very sporting. He was always a big man and known as a gentle giant. The town was devastated."
Former Taupo Times editor Mike Fletcher, who now lives in Rotorua, said it was big news in Taupo and Turangi at the time because such a shooting was a rare occurrence.
"I was surprised about the arrest but it also highlights how cold cases are really never cold and it shows that the police are doing their job."
