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Farmers Reject Terrorist Tax Offer

7 May 2004
Farmers Reject Terrorist Tax Offer

The government's offer to cut a pathetic $4 million from its $20 million terrorist tax on traders is totally unacceptable, said Tom Lambie, President of Federated Farmers of New Zealand (Inc).

His comments follow news that the government has offered to pay 20 percent of the border security tax due to be slapped on exporters, importers and trans-shippers from July 1.

"The government has admitted it mucked up the process for setting the border security charge. Why won’t it see sense and cancel what is clearly another ridiculous tax?" Mr Lambie said.

"The revised offer is being portrayed as a major change in government thinking. What poppycock. Instead it shows a government running huge surpluses that ignores sound arguments, and won’t budge when it spies an opportunity for a new tax," Mr Lambie said

Federated Farmers is one of many organisations that say traders should not have to pay for a government initiative to beef up border security.

Protecting the New Zealand economy from the effects of terrorism is a public good like the police or armed forces. Specific sectors of the economy should not be singled out to pay for a public good.

Federated Farmers also rejects the notion of a 50/50 or any other split. Importers and exporters already pay substantial amounts of tax, which should be used to fund public good activities such as border control.

"In negotiations over the terrorist tax, the government admitted that it mucked up the entire process of setting the tax. It failed to consult on the proposal, did no cost-benefit analysis, and delivered it to industry as a fait accompli."


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