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

From Sky Tower to cowshed

Every morning dairy farmer Sam Waugh sees the Auckland Sky Tower through his window. It's a great reminder of one of his key life goals - giving young people from towns and cities insights into farm life.

Celebrating dairy farmers this International Women's Day

Siobhan O’Malley is a dairy farmer, innovator, businesswoman and community volunteer, an example of the thousands of Kiwi dairy farming women throughout New Zealand who multi-task every day to contribute positively to their communities.

Unique dairy farms open their gates

A dairy farm working to increase endangered skink numbers and a boutique farm selling milk in recycled bottles will open their gates to the public this Sunday.

Featured

Sheep drench resistance costly

Analysis by Dunedin-based Techion New Zealand shows the cost of undetected drench resistance in sheep has exploded to an estimated $98 million a year.

Dairy sheep and goat turmoil

Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand for their products.

Hurry up and slow down!

OPINION: We have good friends from way back who had lived in one of our major cities for many years.

National

Govt urged to reduce ETS units

The Climate Change Commission wants the new Government to reduce NZ Emissions Trading Scheme (ETS) auction volumes as son as…

Dairy sheep, goat woes mount

Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand…

Machinery & Products

All-terrain fert spreading mode

Effluent specialists the Samson Group have developed a new double unloading system to help optimise uphill and downhill organic fertiliser…

Can-Am showcases range

Based on industry data collected by the Motor Industry Association, Can-Am is the number one side-by-side manufacturer in New Zealand.

» Latest Print Issues Online

Milking It

Papal visit

OPINION: European farmers are going to extreme lengths to have their message heard.

Thai egg tarts

OPINION: The hustle and bustle of one of Bangkok's most popular fast food outlets may feel a world away from…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter