Farm value tax a suggestion —Mr Moyle

Press, 16 December 1985, Page 4

Farm value tax a suggestion —Mr Moyle

PA Wellington The Minister of Agriculture, Mr Moyle, yesterday described as an alterable “suggestion” a major part of the farm package in last week’s economic statement. Mr Moyle said of the standard value scheme change: “If there are in fact things in the suggestion that are not tenable, well, we will correct them.” The package’s scrapping of the old scheme, a taxation deferral system on payments for livestock, has emerged as the main source of contention.

Mr Moyle said size of attendance rather than standard values was the reason for communication problems at meetings with farmers in Christchurch. “We have decided we will proceed with the meetings,” said Mr Moyle of talks he had held with the president of Federated Fanners, Mr Peter Elworthy. “I don’t think the Christchurch meeting was of the type conducive to the sort of discussion probably needed.” It had been difficult to give details in an open air venue, he said. A high-level committee including representation from Federated Farmers was also planned especially to look at the “proposal” in detail, he said. “We would expect that committee to be sitting till probably April, and then we would have a much clearer picture if any modifications are required.” “What we need is a good

on-going discussion with Federated Fanners.” He agreed there was bound to be confusion among farmers on the tax changes. When changes were made to a long-standing policy and a farmer did not have the complete information, then he could get a wrong impression. Mr Moyle said that there was plenty of time for discussion because legislation would not have to come into force until March 1987.

The Opposition’s spokesman on agriculture, Mr lan McLean, said an initial examination of the standard value changes showed sheep and cattle farmers alone could be retrospectively taxed on an extra $365 million of paper income. “All the sheep and cattle in New Zealand would have to be sold and maybe that’s what Trevor de Cleene wants. Every existing farmer would be off his land,” said Mr McLean.

And a red deer hind valued at $4OOO would have a $2600 tax liability on it. Although payment could be deferred over several years it was still a tremendous blow, he said “It’s a crazy way to help farming — to put a new tax on. It’s an obscene joke.”

The standard value scheme works by allowing a farmer to defer paying a large amount of tax in the same year as he or she buys livestock. A proportion of the payment for each animal is written off against other income until the stock are sold.