Two decades after Helen Clark’s abandoned “fart tax”, Jacinda Ardern’s government has unveiled its plan to charge farmers for agricultural emissions.
In a world-first move, New Zealand is forging ahead with farm-level charges for its highly-polluting agricultural industry, which produces roughly half of the country’s greenhouse emissions.
The scheme, to start in 2025, asks farmers to report their stock, dairy cattle and synthetic nitrogen fertiliser use and pay a fee based on their emissions.
The levy price will be set by government, but influenced by the Climate Change Commission modelling based on New Zealand’s Paris Agreement emission targets – which were legislated by Ms Ardern in 2019.
Ms Ardern said revenue raised would be recycled back into the industry, helping farmers transition and funding low-emissions projects.
“Farm-level pricing presents the best opportunity to meet our emissions targets,” Ms Ardern said on Tuesday at Kaiwaiwai Dairies in the Wairarapa farming region.
Ms Ardern said Kiwi farmers would benefit as global “first movers” given increased demand “in a world increasingly concerned about the provenance of their food”.
“Cutting emissions will help New Zealand farmers to not only be the best in the world but the best for the world, gaining a price premium for climate friendly agricultural products while also helping to boost export earnings,” she said.
The policy will be hugely contentious and politically risky for the government, given increased costs to an industry closely aligned with the national psyche.
In the early 2000s, Ms Clark was the first to attempt to reign in agricultural emissions, with a “research levy” quickly re-dubbed a “fart tax” by her political opponents.
The policy met with vociferous opposition, including tractor protests on parliament in Wellington, and dumped.
Ms Ardern’s government will face a similar revolt.
Peak body Federated Farmers president Andrew Hoggard said the plan “will rip the guts out of small town New Zealand”.
“It’s gut-wrenching to think we now have this proposal from government which rips the heart out of the work we did. Out of the families who farm this land,” he said.
Mr Hoggard believes the plan will lead to a smaller herd and shrinking industry, with farmers instead choosing to plan trees for carbon credits.
Climate Change Minister James Shaw referenced Ms Clark’s abandoned plans at the announcement on Tuesday.
“It’s been a very, very long journey and we are well, well past time to get going,” he said.
“If we’re serious about the climate crisis we must cut emissions urgently … we’ve been talking the talk for some time and now it’s time to walk the walk.”
Agriculture Minister Damien O’Connor, himself a farmer, was optimistic times had changed.
“This is a new exciting time for farming and the new generation that are coming on, see this as an an absolute necessity,” he said.
“Most people running a farm like a challenge. The challenge will be how to increase their profit and lower their carbon footprint.”
The plan will go to a final consultation over the next month, with Ms Ardern open to changes.
“We’re committed to building a system that works for farmers. We will continue to work in partnership to drive as much consensus as possible to ensure we have a system that lasts the distance,” she said.
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