Oh really Nick? Hark back to 2005.....!

Nelson/Marlborough Farming Column
December 2005

The appetite of Dr Cullen and this Government for more taxes is legendary, 43 new and increased levies and taxes have been introduced.  The latest is the carbon tax.  It will add 6c per litre to the price of petrol, 7c per litre to diesel, 6% to all power bills and put the price of coal and gas up by 9%.

This week National launches the axecarbontax.co.nz campaign.  The new finely balanced Parliament gives us the opportunity to send the carbon tax the way of the fart tax.

The madness of the Government’s new carbon tax is that New Zealanders will be the only people in the world paying it.  It will drive up the costs of living and undermine the competitiveness of New Zealand business for negligible environmental gain.

Labour Ministers may take pride in being toasted at International Climate conferences for being so bold and brave, but there is no justification for New Zealand going out in the cold by itself on this issue. 

New Zealand’s greenhouse gas emissions made up only 0.4% of the global total and on a per capita basis our emissions are half those of countries like Australia and the United States.  We are the only Southern Hemisphere country with binding legal obligations under Kyoto and giants like China and India have got off scot free.

The carbon tax will cost the Nelson and Marlborough regions $25 million a year.  We are particularly hard hit because industries like fishing, farming and forestry are big fuel consumers.  The tax is particularly insulting to the forestry sector and those farmers who have woodlots because the Government has taken the carbon credits for themselves.  Only a Labour Government would have the audacity to impose a carbon credit on the forester for his diesel use but steal the carbon credits from his growing forest.

A further concern of the carbon tax is its impact on inflation, interest rates and the exchange rate.  It will add to the costs of fuel and power and these flow right through the economy to basics like food.  This puts pressure on inflation, which in turn drives up interest rates and the kiwi dollar.  The Government’s carbon tax is a classic example of the way the Government is making things tougher for the productive exporting sector.  It just makes their policies of 2006 being the ‘Year of Exports’ an exercise in shallow spin.

It is also interesting to note who gets exempted from the carbon tax.  Big industries like Colmalco, New Zealand Steel and Golden Bay Cement have the option of Negotiated Greenhouse Agreements (NGA’s).  These are being done on the basis that such big players would relocate if imposed with the carbon tax.  The flaw is that many small and medium businesses face exactly the same competition but just get dumped with the cost.

These agreements also drag New Zealand back into the Muldoonist era of industries pleading special cases to Ministers and mates rates for those who cuddle (or at least don’t criticise) the Government.

The worst aspect of the carbon tax is that it will not make one iota of difference to New Zealand’s emissions.  We know from previous occasions when Labour raised the petrol tax that 6c per litre extra will not reduce consumption.  Even Treasury’s briefing papers to the incoming Government conceded it would have a negligible effect. The only conclusion is that the carbon tax actually has nothing to do with Kyoto or climate change but is just an excuse for Dr Cullen to get his fingers deeper into the pockets of New Zealanders.

National believes, with public support, we can defeat this new tax.  ACT, United and NZ First all campaigned against it during the Election.  Labour and the Greens do not have the numbers.  The Maori Party may determine its fate.  In Parliament however, the fart tax was killed off by people power and the carbon tax could fall the same way.

The Nelson and Marlborough economies are struggling.  The last thing we need is another $25 million being sucked out with this new tax.  If you would like to assist the ‘axecarbontax’ petition and campaign, contact my office.  We need to bury this lemon.