Monday, 25 February 2019 12:38

Changes to tax should support dairy sector

Written by 
Tim Mackle. Tim Mackle.

Any changes to the tax system should better support the productive dairy sector and not hinder environmental work, says DairyNZ.

Following last week’s Tax Working Group (TWG) announcement, DairyNZ says changes to the tax system should be considered alongside other potential changes for farmers.

DairyNZ will be looking closely at the TWG report and its implications for farmers.

Chief executive Tim Mackle says DairyNZ has strong concerns of a system that looks likely to have significant implications for farmers across a broad range of areas from business asset valuations, administrative costs, succession planning and retirement schemes. 

“Any changes to the tax system should better support the productive sector and recognise other proposals which are going to impact farmers too,” said Mackle. 

“Just like the government, we will analyse the report to fully understand the impacts the proposals would have on the dairy sector. Farmers already pay a disproportionate amount of tax through rates, compared to other modes of production.”

Farmers are facing a number of potential environmental and financial pressures, which has seen many invest heavily in the environmental sustainability of their farm businesses.

“If an environmental tax was also introduced, it is likely those farmers who are motivated to invest in improving environmental performance will have resource diverted,” said Mackle.

“For example, if a farmer had a spare $20,000 per year to invest, this money could be spent planting a 2km riparian strip of 3m wide with native plants. This activity would contribute considerably more to improving water quality and mitigating emissions, than an additional tax.

“So, while we support the working group’s intention to develop a set of long-term goals to help guide New Zealand to a more sustainable economy, incentivising behaviour change will have more impact than penalising farmers.”

DairyNZ agrees there is a need to encourage farmers to mitigate their greenhouse gas emissions, and influence land use and intensity decisions.

“Greenhouse gases are already taxed through the Emissions Trading Scheme. If agriculture enters the scheme, we support the revenue raised being reinvested into the development of low emission technologies, mitigation options that support farmers to improve the sustainability and profitability of their businesses.”

Mackle says DairyNZ shares the need to accelerate the good environmental work already underway in many parts of the country.

“We are focused on ensuring the dairy sector achieves a balance between being competitive and profitable, while also meeting the expectations of our customers and communities.”

 

More like this

How do we manage change?

The dairy farming industry needs to keep thinking about what it can do differently in response to the big change coming at it, says Luke Beehre, project leader of the Northland Extension 350 (E350) programme.

Less mud throwing — Editorial

It looks like the next attack on farming will take the form of a campaign against winter grazing and the negative impact this can have on livestock and water quality.

Report dodgy fliers

Dairy farmers are being urged to tell authorities about “concerning activity” by helicopters and drones.

 
 

» The RNG Weather Report

» Latest Print Issues Online

Milking It

No tea, we’re vegan

UK vegans are demanding a law change to ban discrimination against plant-based eaters in workplaces.

Fake cows

Even more fibreglass cows may join those seen ‘grazing’ Morrinsville streets for four years.

» Connect with Dairy News