The New Zealand government is yet to rule out a fertiliser tax as an interim funding measure, while the farming sector finalises its plans to put a 'price' on its greenhouse gas emissions.
NZ Agriculture Minister, Damien O’Connor, pointed out that ‘the generosity of the taxpayer can’t continue forever’ as pressure mounts on the administration to fix an emissions plan for agriculture before the parliament’s last sitting day on August 31.
READ MORE: Fertiliser tax on the cards in New Zealand
Last December, the NZ government’s proposals to price emissions caused uproar in the farming community but politicians still want to see legislation introduced by the middle of this year. If no new legislation is in place, then in 2025 the New Zealand farming sector will enter the Emissions Trading Scheme (ETS) which requires businesses to purchase carbon credits for each tonne of emissions they produce.
Speaking to The Herald (NZ) newspaper, Mr O’Connor said the parliament still wanted a deal sorted before Parliament stopped and was also considering interim options to raise funds for research and development. The measures proposed included a fertiliser levy which O’Connor confirmed has been discussed within the sector.
Currently, New Zealand farmers use 400,000 tonnes of fertiliser and every tonne sold would get a levy applied to it.
“The idea of a levy that would have contributed to money for research and development was my idea of a possible good investment,” Mr O’Connor told the New Zealand Parliament. But he did admit that 'industry leaders have come back to me and said they don’t like that'.
READ MORE: Mounting pressure on government to reduce fertiliser tariffs
"We now have to sit down and work on the best way forward. Dealing with the dilemma that they don’t want to pay anything until they’ve worked out the full analysis of sequestration options and that will take some time. It will take more research and development. The issue is, who will pay for that.”
Climate Change Minister, James Shaw, said: “We haven’t ruled anything out and we’re constantly talking to the sector about what the options are. There are a lot of calls from the sector to delay the introduction of the pricing scheme.
"But I think there is an expectation from New Zealand society that the sector should be paying for its emissions somehow – and from every other sector of the economy that already does pay for their emissions.”
The New Zealand Government has committed to a 10% reduction in methane from agriculture and landfills by 2030, going up to a 24-47% reduction by 2050, compared to 2017 levels. It comes alongside a net-zero carbon emissions target for 2050.
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