Farmers do u-turn on carbon tax

Federated Farmers Don Nicolson, making a submission on the Emissions Trading Scheme to a parliamentary select committee earlier this year. Photo / Mark Mitchell.

Federated Farmers has come full circle, suggesting yesterday a carbon-tax to fund research on science and technology might not be such a bad thing.

The organisation bitterly opposed the farming levy proposed by Labour in 2003 - the so-called "fart tax" - to fund research into agricultural emissions. It was eventually dumped and Labour developed an emission trading scheme that imposed much higher costs on farmers.

President Don Nicholson said yesterday that farmers might now have to eat humble pie and that a low carbon charge could be a better mechanism than the emissions trading scheme.

Nicholson said Federated Farmers wanted 0.5 per cent of GDP spent on research and technology.

"We think that perhaps a low-level carbon charge could be the mechanism to get there. The compliance regime around that is close to zero. It would be better for all of us to bury the hatchet on it and get over the hassle of an ETS."

The farmers are still bitterly opposing an ETS even though National is proposing major changes to reduce costs to farmers.

Nicholson made his comments after Labour leader Phil Goff had talked to the Federated Farmers national council meeting in Wellington.

When Goff remarked at the similarity of what Nicholson was proposing to the "fart tax", Nicholson said farmers at the time "didn't know where it would end" and the levy had applied only to one sector. At that time Labour planned to exempt the farming sector from a tax on its emissions but impose a research levy of about $300 a year for the average farm.

National says its ETS scheme will cost the average farmer $3000 a year by 2030 and that Labour's ETS would cost $30,000 a year.