7 March 2001
Budget scraps spray tax plan

By FWi staff

THE government has dropped its plans to tax pesticides, opting instead for voluntary measures to encourage responsible use by farmers.

Chancellor Gordon Brown revealed the decision to drop the proposed spray tax in documents accompanying his Budget on Wednesday (7 March).

Farmers and chemical manufacturers had argued that taxing pesticides would have cost the industry 125 million a year and had no environmental benefit.

Nevertheless, the voluntary proposals, which include training and crop-management programmes, is expected to cost farmers about 11m a year.

The National Farmers Union and the Crop Protection Association – which represents agrochemical manufacturers – had long opposed the tax plan.

Chris Wise, NFU crops adviser, said he was delighted that the government had dropped the proposals, although he was unaware of the final details.

The Chancellor also used the Budget to rubber-stamp a decision made last year to abolish excise duty on agricultural vehicles.

But many felt that what was billed as a give-away Budget before the next General Election could have contained more for farmers.

The big farm unions slammed Mr Brown for failing to allocate funds to help all farmers hit by foot-and-mouth disease.

Representatives were disappointed that there is nothing for those who lost their income through the bans on animal movement exports.

Compensation is being paid to producers whose stock contracts the disease.

Hugh Richards, president of the National Farmers Union Cymru-Wales, said Mr Brown should have compensated both direct and indirect consequential losses.

“The agrimonetary compensation that he mentioned is not new money, and has nothing to do with foot-and-mouth,” he said.

“Its designed to compensate farmers for losses suffered as the result of the weakness of the Euro against the Pound, and is farmers right.”

Mr Richards welcomed the Chancellors decision to abolish Vehicle Excise Duty on tractors, but was disappointed that there had not been greater fuel tax cuts.

Emyr James, director of business development for the Farmers Union of Wales, said the Chancellor merely recycled money that is already in the system.

“He had nothing else to say about farming which we find depressing at such a worrying time for the industry,” said Mr James.

Mr James said an drop of 2ppl in petrol duty and 3p off diesel merely rubber-stamped what had been promised in the November pre-Budget statement.

“I suppose the rural areas will be the last places to stock this so-called new fuel, so what will happen if it is not at our pumps by June?”

John Kinnaird, of the National Farmers Union of Scotland, said: “The chancellor has brought nothing new to the table since the Pre-budget Report in November.”

Mr Kinnaird said nothing had been done to address the concerns of rural areas that are disproportionately affected by high fuel tax by a cut in ultra-low sulphur fuels.

He welcomed the abolition of Vehicle Excise Duty on tractors, but said the NFUS will seek clarification that this extends to all agricultural vehicles.

Douglas Rowe, president of the Ulster Farmers Union, called on ministers to clarify their commitment to the future of farming in the United Kingdom.

The Budget was “yet another lost opportunity” and farmers were being left behind, while the rest of the economy was booming, Mr Rowe.