22 May 1998

Input tax plans are seriously flawed

By Charles Abel

GOVERNMENT plans to raise £200m through a so-called environmental tax on crop inputs have been slammed by agrochemical manufacturers.

The manufacturers trade body, the British Agrochemicals Association, claims fundamental miscalculations on the likely impact of such a tax have been made by the Department for the Environment, Transport and Regions. It has submitted a detailed report to the DETR pointing out its errors.

The DETR says farmers could save £605m a year through existing pesticide minimisation techniques, leaving them in pocket even after a £200m tax. "But the savings just arent there to be made," argues the BAAs Patrick Goldsworthy. "What DETR has failed to realise is the extent to which farmers have already adopted the techniques suggested in the analysis. In reality the benefits will only be about £182m."

The technical errors were identified in a study conducted by independent agronomy group Morley Agricultural Consultants.

"Most farmers and advisers already cut dose rates to a minimum, use disease and insect thresholds and forecasts, grow resistant varieties where appropriate and use the best sprayer technology available," says MAC head Peter Riley.

Double counting of some benefits distorts the figures still further, he notes. The contribution of natural pest predators is counted twice, for example – once under field margin benefits and once under the encouragement of natural predators.

Use of 1996 data further confuses the picture, notes Mr Goldsworthy. "Farming practice has changed a lot since then, as have crop prices."

The proposed tax, which has no proven environmental benefits, would hit UK arable farming hard, says Mr Goldsworthy. "They could be left at a serious competitive disadvantage to their European counterparts."

If adopted the tax could also force more farmers to import products in an effort to by-pass the tax, he notes.

With EU-wide environmental policies likely to be included in the reformed CAP a unilateral green tax for the UK makes little sense, the BAA adds.

Further initiatives to combat the tax are planned. "I want to keep our powder dry for now, but we do have further things planned," says Mr Goldsworthy.

Watch out for a major FW campaign to combat the tax in next weeks issue.

AGCHEMANGST

&#8226 Input tax still high risk.

&#8226 DETR estimate of possible input savings too high.

&#8226 Impact of tax on UK arable farming would be severe.

&#8226 Little evidence of benefits to the environment.