In a YouTube video obtained by 3News before it was taken down, Mark Taylor is heard telling IS sympathisers: "Now is the time to commence your operations, even if it means you have to stab a few police officers, soldiers on Anzac Day and so be it."

He adds: "Your passports have been taken which is a test from (inaudible) especially from New Zealand and Australia."

Taylor concludes: "Sending your troops here is the biggest mistake again...we're waiting for you."

Police said they and security agencies had conducted "a thorough assessment of the video."

"We take our responsibility for the safety and security of New Zealanders very seriously and, while we are unable to go into detail, we have already taken further security measures.

"We are satisfied that all appropriate and necessary measures are in place for Anzac Day.

"New Zealanders should feel confident in attending Anzac Day events as planned, while exercising their usual vigilance in light of the current global security environment."

Prime Minister John Key told 3 News from Istanbul: "It just reaffirms what I've been saying; that it is a war they've been trying to bring to New Zealand."

Taylor's video comes as New Zealand deploys more than 100 troops to Iraq to train up local soldiers in the fight against IS.

Taylor is one of a handful of New Zealanders known to be fighting for IS in Syria and burned his New Zealand passport after crossing the border from Turkey.

Friends say he is delusional and got most of his training from playing computer games but his wife in Indonesia claims that he previously served with the New Zealand Defence Force.

In a statement, the New Zealand Defence Force said it was also aware of the video.

"We are reassured that Police are working hard to ensure safety at planned events and all appropriate steps are being taken.

"Defence personnel and the public should remain prudent in order to maintain their personal security; however we will continue to pay our respects to the fallen. Commemorative activities will continue as planned."

Taylor goes by the Twitter handle of Kiwi Jihadi and has posted pictures of himself on the internet and over Twitter posing with guns and long knives.

The only known Kiwi face of the "foreign fighter" threat, he is also known as Abu Abdul-Rahman and various other names. He made it to Syria despite being on a terror suspect list which was supposed to restrict his ability to travel.

Key previously confirmed Taylor had been monitored by intelligence agencies for some time and was one of an unspecified number of Kiwis who have had their passports cancelled to stop them travelling to Iraq or Syria to join the cause.

The Government beefed up its terror laws in response to the "foreign fighter" threat earlier this year. But their biggest fear is lone-wolf style attacks like those that caused terror in the Canadian Parliament and the attack on a Sydney cafe.

Security Intelligence Service head Rebecca Kitteridge said late last year New Zealanders were accessing IS propaganda material urging followers to target the citizens of "crusader" nations "where ever they can be found".

Taylor's appears to be the first specific threat to New Zealand, and 3 News reported it had been sighted by only a handful of viewers on YouTube.

Kitteridge also revealed that SIS had been monitoring individuals who were planning IS-inspired attacks in New Zealand.

"There are people we know who are interested in these kinds of acts."

The Government weighed up the possibility that deploying troops to Iraq would heighten that risk but said foreign policy could not be dictated by  terrorist threats.

Stuff.co.nz