UK call for reforming European CAP farming subsidies
|February 10, 2010||Posted by Jeffery J. Smith under Progress Report, The Progress Report|
UK call for reforming European CAP farming subsidies
Kiwi Leader Urges Public Recovery of Land Value
While the Brits call for ending the subsidies to farmers, the Kiwis go one better and call for re-levying a tax on farmland, which would drive out the land speculators. Both proposals are part of the overall geonomic reform of replacing taxes with land dues and replacing subsidies with rent dividends. We trim, blend, and append three 2010 articles from: (1) BBC, Jan 27, on subsidies; and The New Zealand Herald on taxing land, (2) Jan 20 by Anne Gibson and Jan 21 (via reader Josh Vincent).
by BBC, by Anne Gibson, and by The New Zealand Herald
- UK call for European CAP farming subsidies reform
Conservationists and landowners have united, in a rare show of solidarity, to campaign for changes in the way UK farming subsidies are distributed.
The RSPB wildlife charity and the Country Land and Business Association (CLA) want to shift funding from food to biodiversity and sustainability.
The BBC’s rural affairs correspondent, Jeremy Cooke, says the joint statement is a groundbreaking move.
The CLA, has 36,000 members, while the Royal Society for the Protection of Birds (RSPB) has more than one million.
Representatives from both are heading to Brussels to lobby for an environmental focus in the European Common Agricultural Policy (CAP).
For some years there has been a slow movement away from paying farmers for what they produce, and towards rewarding them for their stewardship of the countryside, he adds.
The RSPB and CLA say that process needs to be “accelerated and widened” to deliver a more viable and sustainable farm system that provides both food and environmental benefits including cleaner water, reduced global warming, and greater biodiversity.
The European Landowners’ Organization and BirdLife International agree and intend to release a joint policy paper late Wednesday.
JJS: Better than letting various groups give public money to their idea of the good is to give everyone a share of natures rental value, amassed into the public treasury via land taxes or fees or dues. If we did that, plus de-taxed earnings, farmers should come out ahead, since rural land is much less spendy than urban land. One nation is headed toward doing just that.
- Tax report takes aim at land speculators
The final report from the Victoria University Tax Working Group will be aimed squarely at the real estate sector, a point backed up by Prime Minister John Key.
Jason Lindsay of Credit Suisse said, “We believe a land tax or denying depreciation on buildings are the two most likely outcomes.
While a land tax may be purer and would raise more money for Government coffers, political considerations may mean denying depreciation on buildings is an easier option for the Government.
He said the Property Council would decry the move on commercial property. The council had been successful in its lobbying in the past.
Westpac chief economist Brendan O’Donovan and research economist Dominick Stephens estimated the tax changes could lower house parcel prices as much as 34%.
JJS: As the tax on land goes up, the price of land goes down. Thats good for buyers. It also shrinks mortgages, and less debt is good for the whole economy. And having a prime minister on the geonomic side, wow, that might even be enough to overcome the opposition.
- Fed Farmers hits out at land tax idea
Federated Farmers has hit out at the Tax Working Group’s recommendation for a land tax, saying the tax could cost farmers NZ$525 million annually.
The group’s report suggested a land tax of 0.5% across all types of land. But it also suggested a ‘value-per-hectare’ threshold, below which no land tax would be collected.
Federated Farmers spokesperson Philip York said he understood the value-per-hectare threshold to be NZ$50,000.
Most farms in New Zealand would fall below that threshold, he said.
“But once they set it up they might change their minds and say [the threshold] is $20,000 per-hectare,” he said.
He said his own situation, with a farm close to the city, would probably see his land’s value causing him to pay the 0.5% tax.
York said farmers were asset rich, but inevitably income poor.
“According to the latest Ministry of Agriculture and Forestry outlook report, farmers are seeing 93.8% of the export income we earn go into everyone else’s pocket but ours,” he said.
“Kiwis already have a land tax and that’s called local authority rates … We’ve got many farmers already paying more than five figures and a few in the six-figure club,” York said.
JJS: The way to help farmers is not with thresholds but dividends. Dont tax their barns, tractors, seeds, etc, or income but just the value of their location. Most would be better off. For sure they would be if they also got a Citizens Dividend.
Further, we should charge farmers and any enterprise for imposing risk. If farmers paid an Ecology Security Deposit, Restoration Insurance, for emission permits (for nitrogen runoff), and fines when exceeding limits (besides land dues), then to avoid these charges farmers would go organic. They, their customers, and the planet would be much better off, once we implement geonomics.
Jeffery J. Smith runs the Forum on Geonomics.
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