Water tax is an issue for us all

Hort Talk
with Mike Chapman
HorticultureNZ CEO

You can’t grow anything without water. Water in the right quantities, at the right time, is vital to grow premium quality fresh fruit and vegetables. Water is also needed to ensure productivity per hectare is maximised.

The Labour Party has proposed a water tax on primary production, but not on city dwellers or industrial users. The aim is to clean up our waterways. But what this Labour proposal ignores is our towns, cities, and industrial users are among the major polluters of our waterways. If you are going to tax water use, then everyone needs to be taxed.

But I question, why tax water use? What any government should be doing is supporting the initiatives from all around the country that farmers and growers are doing, and have been doing for some time, to clean up our waterways.

There is also a disconnect with this policy – just because you use water, that does not mean you are a water polluter. Would it be more logical to tax the water polluters to encourage them to stop polluting?

Not right way

I do not believe a tax is the right way to deal with water pollution. The best way forward is to work with the primary sector, industrial users and urban New Zealand to all contribute to cleaning up our waterways.

There are numerous water storage schemes being built privately by farmers and growers across New Zealand. Building these structures is not cheap. Another question to ask, is rain going to be taxed when it is used to fill up water storage ponds and tanks? Then there are projects to recharge aquifers so that water flows are maintained during dryer periods. Are projects such as this going to be taxed? There needs to be equity and a recognition of efforts farmers and growers are already making.

My major objection to taxing water users however, is that it will ultimately result in increased prices for fruit and vegetables. The water tax will end up being passed onto consumers with more expensive fruit and vegetables.

Healthy diet

Already one-fifth of New Zealand do not buy fresh fruit and vegetables each week. Increased costs will likely result in less New Zealanders having a healthy diet that includes fresh fruit and vegetables. What this means is that the government will end up paying more for health care, as there will be an increase in obesity, diabetes and heart disease. So taxing water use has a massive unintended consequence – a less healthy New Zealand and the need for increased medical care. Was this really intended? I do not believe so.

The industry will always work with government and political parties to develop policy. Labour is saying that if elected to form the next government, they will then meet with industry to develop the policy. To be fair, this is only an idea at present. The detail is yet to be developed. But before the detail is developed, I think that the unintended consequences of a water tax, and the disconnect between users and polluters, need to be factored in.

It makes sense to work on the concept pre-election so that when it comes to working out the detail, it is focused on achieving the stated aim and not penalising the primary sector – one size does not fit all. So we are keen to sit down and work through the proposal and then the detail.


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