30 June 2004
PR 139/04

Government Issues Blank Cheque

Intense lobbying by farmers helped convince the government to foot $4 million of the 'terrorist tax'. Nevertheless the task now is to keep a lid on the total cost, said Tom Lambie, President of Federated Farmers of New Zealand (Inc).

His comments follow Parliament passing the Customs and Excise Amendment Bill*. The Act sets a new border security tax on exporters, importers, and trans-shippers.

However the legislation fails to ensure that the intended $20 million tax does not balloon out of control.

"Federated Farmers supports the aim of securing New Zealand food exports from terrorist attacks. But we condemn taxing wealth creators to pay for beefed up border security when the legislation is based on poor process and lacks sound principles," Mr Lambie said.

"Increased border security is clearly a 'public good' activity like the police and armed forces. Taxing exporters to fund public good activities reduces the competitiveness of New Zealand business," Mr Lambie said.

"This Act is a blank cheque for NZ Customs. There is nothing in this legislation that requires the fees to be justifiable or equitable. Without a requirement for efficient and transparent process, exporters and importers will have to find some other way to ensure that their money is being used appropriately.

"The Government acknowledges that the process of setting the tax was badly flawed. It is appalling that such poorly developed policy has got through our Parliament,” Mr Lambie said.

*NOTE: The bill was formerly the Border Security Bill, which was recently split into the Customs and Excise Amendment Bill and Immigration Amendment Bill (No 3). Both passed their third reading on Tuesday night.

ENDS

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