Woodlot tax scheme under consideration

Press, 19 May 1982, Page 20

Woodlot tax scheme under consideration

A tax deduction scheme is being considered by the Government to encourage woodlot planting by small growers. Speaking to the Farm Forestry conference in Christchurch, the Minister of Forests (Mr Elworthy) said that the proposal would allow the costs of woodlot establishment and management to be deducted from revenue and spread over a period of time. It would give proper recognition to the need for wood to be treated like any other primary product, and would run along the lines of the tax rebate scheme applying to farmers. If such a package were approved, the existing grants and loans scheme would probably have to be abolished, Mr Elworthy said. He hoped that an option would remain, so that people disadvantaged by the tax rebate scheme could choose another form of assistance. A brief survey of two conservancies had shown that some growers would be disadvantaged by a tax deductibility scheme.

He could give no guarantees about the. form of assistance, or the time of its introduction, he said. This would not be known until Budget night. Mr Elworthy said that some local authorities adopted district schemes that discriminated against forestry. It was up to growers to examine proposed district schemes for restrictive zonings, and to make submissions.

. One local authority had imposed a differential rating which penalised forestry with rates six times higher than on other land. “Little wonder that the number of applications for assistance under the grants and loans scheme shrivelled away to almost nothing,” he said.

Where local authorities made forestry a predominant use on certain classes of land, there had been a mushrooming use of the grants scheme. About 3000 small growers were using the grants scheme, and by the end of March this year had planted

more than 80,000 ha — nearly 10 per cent of New Zealand’s total exotic estate.

Answering criticism of the forestry extension scheme, Mr Elworthy said that because of the need for a tight rein on public service staffing levels, only 30 officers were available, and were “thinly spread.”

If new forms of financial assistance were adopted, forestry extension officers would be freed from administrative work to advisory work, he said.

Mr Elworthy said it was heartening to see the number of new species that were being introduced by private growers. This lessened, the demand on the diminishing native resource.

Greater research was needed into the benefits of shelter and shade planting on properties and further effort in planting, tending, and marketing. Small foresters should also keep abreast of developments in energy production from wood.