Industry rounds on input tax report

2 April 1999

Industry rounds on input tax report

THE agricultural and chemical industries have responded strongly to the Department of the Environment, Transport and the Regions report on pesticide taxes, saying it raised more questions than it answered.

The report, which was released last week (News, Mar 26), claimed that a 30% tax on pesticides would cut pesticide use by up to 20% and lead to substantial environmental benefits.

But the industries fear that a tax would reduce the ability of UK farmers to compete with the rest of the world.

"From our own research we believe that a pesticide tax would be detrimental to the environment as well as to the UK economy," said Anne Buckenham, director general of the British Agrochemical Association.

A pesticide tax would force farmers to adopt less environmentally-friendly practices and push many small farm businesses over the brink and into bankruptcy, Dr Buckenham added.

The governments own estimate is that a 30% tax level would result in 2% of farm businesses becoming unprofitable.

Chris Wise crops adviser at the NFU agreed that the governments findings contrasted sharply to two reports, commissioned by the BAA and NFU, which concluded that a pesticide tax could cost the industry £320m and still fail to meet environmental objectives.

"There are far more elegant ways than a tax, to deliver reductions in a sustainable way."

The better way to reduce pesticide inputs is to improve the availability of technical information to farmers, he suggested.

And Mr Wise criticised the governments figures which suggest that a 30% tax would result in a 3% cut in farm incomes. These figures are based on 1996 figures – before the major slump in profitability – and need to be updated, he said.

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