Forestry owners must understand levy proposal

By Federated Farmers Senior policy advisor, Jacob Haronga

The New Zealand Forest Owners Association (NZFOA) is developing a proposal for a commodity levy on harvested logs, to support industry good activities.

Federated Farmers wants all farmers to be aware of and understand the proposal and to make sure they vote when a referendum is announced on the issue.

Currently, NZFOA is a voluntary membership organisation supported largely by corporate forest interests. It also works with the New Zealand Farm Forestry Association, a voluntary membership organisation supported by farmers with smaller woodlots.

As a voluntary membership organisation itself, Federated Farmers knows the work it does benefits all farmers, not just its own members.

This free-rider dimension is one reason why NZFOA is considering a commodity levy to fund their own activities on behalf of the owners of New Zealand forests.

Federated Farmers has seen initial documents describing various aspects of how NZFOA would see their proposal functioning if successful in a support referendum.

What is essentially proposed are two things: augmenting many of the activities NZFOA already undertakes and better enabling them to address emerging concerns, such as direct funding for new biosecurity initiatives and new areas of research.

The objectives for the proposed levy would be to see NZFOA represent and promote the interests of plantation forest growers and the sustainable growth and profitability of forest growers.

NZFOA would also look to facilitate and implement relevant research projects, the transfer of technology to growers and the wider industry and facilitate co-operation within the industry where there are common objectives.

With land-use issues increasing in importance and attention, the proposed levy would, in co-operation with the wider industry, also go towards the promotion of forest products and the broader benefits of forestry within New Zealand.

The proposal would affect anyone that harvests a tree and either puts the log through a mill or across a wharf for export.

Further, it seeks to impose a levy on harvested logs either exported in log form or processed in New Zealand. Domestic firewood, bark and Christmas trees will be exempt from the levy.

The levy would likely be collected by sawmills for domestic logs and port authorities for exported logs.

The proposed levy rates and the total quantum funding that would be sought under the commodity levy are unknown at this stage.

Also unknown is the precise allocation of levy funds towards different activities such as technical policy analysis, advocacy and representation and research.

This will all hopefully be explained when the final proposal is released for consultation. Initially, the proposal was meant to go out for consultation in February earlier this year.

This has since been revised with NZFOA looking to take more time to better develop its proposal. A revised date for release of the proposal and subsequent support referendum has yet to be set.

As the proposal has the potential to affect every farmer who owns forests, members are encouraged to make sure they understand the levy proposal and keep a watchful eye for developments.

Where practical farmer forestry owners should attend a consultation meeting on the levy proposal and make sure they understand it.

This means when a referendum is announced farmers will have all the information they need to make an informed vote.

- Hamilton News

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