The report is the latest in a series of urgent inquiries by the tribunal into decisions by the new National Party-led government.
The coalition government wants to reverse the decision by the previous Labour government - which abolished the referendum requirement for Maori wards.
Local Government Minister Simeon Brown said it would reverse changes which stopped communities voting on whether Māori wards should be established.
Claimants say the 2021 amendments have increased Māori representation in local government and a repeal would prejudicially affect Māori by reducing numbers.
They say it would expose Māori communities to racism, abuse, and damage their relationship with the crown.
The Māori Wards and Constituencies urgent report found the crown has failed to actively protect Māori rights and interests by ignoring the desires and actions of tangata whenua for local representation.
It found breaches of principles of mutual benefit and options which would cause significant prejudice to Māori.
The Tribunal recommends the crown stop the amendment process and have proper consultation between Treaty partners with a view that shows how Māori can still exercise their tino rangatiratanga on a local level.
The report came to the conclusion that government's stance appeared to show its 100 day plan could rule over the Te Tiriti.
"We wish to make the general point that a consistent theme runs through this and other recent urgent applications to the Tribunal: 'An assumption on the part of the government that the coalition agreements that led to its formation override or take precedence over the Crown's obligations under the Treaty of Waitangi'.
"The evidence we have seen in this inquiry in respect of reintroducing the poll provisions concerning Māori wards shows the same prioritisation in operation: In every policy document we looked at, the coalition agreements take precedence over the Treaty, in some instances, literally by being placed earlier and more centrally in policy documents.
"In other cases, the Treaty is barely mentioned at all. At every opportunity the minister has adopted the shortest possible timeframes to progress coalition agreements at the expense of proper Treaty-consistent process, including genuine consultation with Māori."
The National Urban Māori Authority (NUMA) has praised the tribunal's report, calling it an "excellent outcome". NUMA was listed as an interested party for the inquiry.
NUMA chairperson Lady Tureiti Moxon said the referendum would prevent the exercise of tino rangatiratanga rather than fostering it.
"This is a very precise, measured, well-reasoned Tribunal report that is conservative and careful in its wording."
The plan was "inappropriate and excessive" and would restrict Māori involvement in local government, Lady Tureiti said.
"At the heart of this matter is policy that rescinds and reverses the resolution to establish Māori wards - this is not fair, just, or equitable."
RNZ
