3 April 1998

Still pesticide tax fears despite budget let-off

By Charles Abel

FEARS about a punitive tax on pesticides remain rife, despite its absence from the budget. Manufacturers and distributors are now mounting a co-ordinated effort to resist government plans to tax pesticides at up to 130%.

"We know were going to get kicked – its just a question of when," says a British Agrochemicals Association spokesman.

Du Pont director and BAA committee member Roger Doig fears the worst. "We believe a political decision has almost already been taken. But the tax will be difficult to implement and it is hard to see how it will benefit the environment."

The BAA argues that the Department of the Environment, Transport and the Regions proposal takes insufficient account of the impact on farming.

The original Ecotec report which underpins the proposals suggested farming could save £500m by improving its pesticide policy. So a tax would not hit farm incomes hard.

But the BAA disagrees. Total savings of £100m are more realistic, it says. That figure emerged from Morley Research Centres analysis of the Ecotec report.

It showed the impact of better application techniques was over-estimated, some technology gains were double counted and others had already been implemented.

A tax would hit farm incomes far harder than the 2-6% DETR suggests, the BAA argues. To find out just how much more a further study has been commissioned to identify the impact such a tax would have on both incomes and the environment.

"I am concerned DETR doesnt understand the complexity of what is a perceived problem," adds the BAA spokesman. "We think there are more appropriate ways of dealing with it."

Mr Doig agrees. "This tax is not terribly logical. It will hit the efficiency of UK farming without doing much to benefit the environment. There are better, more focussed ways to achieve that goal."

Pesticide limits based on sound science mean the UK industry is one of the best regulated in Europe, he stresses. "An arbitrary tax would undermine that."

Environment Agency complaints are rare and falling, he adds. Incorrect sprayer washing, pack rinsing and spills are greater threats than general spraying. "Better training and enforcement in those areas makes more sense than a blanket tax."

A tax would also hit distributors hard, notes Profarmas Paul Singleton. The agchem market is tumbling already, so further restrictions could see big cuts in agronomic advice to support product sales.

The tax may have more to do with politics than scientific need, Mr Doig adds. "If it is a political move, for income or catching the environmental vote, Im not sure how we can turn it around. But we are lobbying government very hard."

Alternative approaches the BAA is considering include licensing of farmers to buy and use pesticides, prescription-only sales and compulsory sprayer testing.

* "Were not happy about the prospect of a tax," says the NFUs Chris Wise. "But we think there may be a delay while a debate organised by the European Commission on pesticide optimisation and the environment takes place this summer."

PESTICIDE TAX

&#8226 Up to 130% tax still on cards.

&#8226 Next report due in July.

&#8226 Science behind tax unsound.

&#8226 Better pesticide use offers savings of £100m not £500m.

&#8226 Severe impact on farm profits.

&#8226 Threat to farm efficiency.

&#8226 May encourage illegal imports.