Farmers ready to fight the introduction of new taxes

Any move to introduce a capital gains, land or environment tax will meet stiff opposition from farmers according to a Federated Farmers survey.

The Federation asked its members for their views last month, to help inform a submission to the government’s Tax Working Group, the close to 1400 responses indicating strong opposition to some of the new taxes that have been suggested.

More than 80 per cent opposed a capital gains tax, excluding the family home, with 11 per cent in support, but 47 per cent would support a CGT on property sold within a five-year ‘bright line’ test. The current threshold is two-years, some seeing an extension to five years as a means of discouraging speculators.

“Farmer opposition is even more entrenched on the idea of a land tax, excluding the family home, with 91 per cent against and only 2 per cent in favour,” Federated Farmers’ economics and commerce spokesman Andrew Hoggard said.

“A land tax would be punitive and inequitable on farming. The strong opposition to it in this survey mirrors its utter rejection by rural New Zealand the last time our tax system was reviewed, in 2010.”

Some 82 per cent of respondents opposed environmental taxation, but there was minority support if such taxes were used to fund on-farm environmental initiatives.

Tax incentives for those who invested in environment-related on-farm projects drew 84 per cent support.

“Just on 12 per cent supported a progressive company tax (i.e. a lower rate for small companies), with 26 per cent opposed and 55 per cent thinking ‘maybe,’ depending on what is considered ‘small.’ There was a lot of concern about compliance implications,” Mr Hoggard said.

“Meanwhile 66 per cent opposed exempting basic items, such as food, from GST, with 29 per cent supporting.

“Federated Farmers will be sending a comprehensive submission to the Tax Working Group, which will pick up on the concerns and comments raised in our member survey,” he added.