Water tax decision and environmental improvements

Thursday 18 April 2019
Media Release

Water tax decision allows environmental improvements to be targeted

IrrigationNZ says the government’s decision not to introduce a water tax in the near future is good news for all New Zealanders.

“The Tax Working Group proposed a nationwide tax on all water use including for hydroelectricity, household, business and agricultural use. That would have resulted in higher power and food prices for households and businesses and higher rates bills for everyone,” says IrrigationNZ Chief Executive Elizabeth Soal.

“Farmers and growers have been proactively taking steps to reduce environmental impacts at considerable cost and this is already having an impact on water quality with many water quality indicators showing improvement in the most recent LAWA dataset including nitrogen,” adds Ms Soal.

“All of us want to see improved water quality,” says Ms Soal. “Both the government and regional councils have signalled there will be further regulation to improve water quality and these changes have further financial costs for irrigators,” says Ms Soal.

“Introducing new taxes would have made it difficult for farmers to continue to invest significantly in improving environmental outcomes which are a priority and which we all want to see,” she adds.

Ms Soal says that there are already a number existing incentives that encourage efficient water use including electricity costs and regulatory nutrient limit rules which require farmers to only use water when needed.

Farmers and irrigation schemes have invested $1.7 billion to modernise their systems since 2011, resulting in significant improvements in water efficiency.

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