Methane Tax in Another Form? Thursday, Aug 2, 2001
It seems that Pete Hodgson’s Ministerial Group on Climate Change .is still poised to disrupt agriculture
as the move to cobble together a policy on gas emissions.
The animal ‘fart’ tax kite did its job by alerting producers to the issue but it seems that
pastoral farmers will still to be prepared for production levies to address greenhouse gas emissions
The current status of the Kyoto Protocol appears to have taken the emphasis away from methane and back
onto general emissions of greenhouse gasses by the allocation of emission credits from an initial
allocation for the country.
The issue is the equity of the allocation of those credits initially between sectors and then particularly
from the farmers point of view the level at which the allocation in terms of the historical
average farm stock numbers and class of stock.
It is a fuzzy proposal that lacks any indication of the structure, it implementation and any quantification
of the financial implications for individual farmers.
While the minister has said he has no intention of introducing a tax on farm production farmers with
term plans for increasing stocking rates on their properties should be pressing for clarification
of the cost when stock numbers exceed the credits allocated.
The purchase of additional credits either on an exchange or by issue from a reserve pool looks remarkably
like a tax on additional production.
Planning for this climate change policy is becoming far more complex than may have first been considered
as the detail is worked out.
Pastoral producers will need to keep a close eye on this plan to ensure thatthey are treated both
equitably in terms of emission assessment but more importantly fairly in terms of the ability of individual
farms to profitably manage under the yet to be designed policy.