“That was a story which confused revenue with profits and what people actually pay tax on. Prime Minister John Key also went in to bat for farmers, saying he thought they paid their fair share of tax. "We don't think the figure is as low as NZ$26 million by any stretch of the imagination." He said those not classified by industry paid another NZ$1.5 billion in tax and a significant number would be dairy farmers. Revenue Minister Peter Dunne defended the tax paid by the dairy industry and said NZ$26 million paid was not low. Parliamentary Library figures showed Fonterra earned NZ$1.86 billion before tax on turnover of NZ$61.6 billion from May 2007 to January 2011.įonterra's after-tax profit of NZ$1.88 billion included net tax credits of NZ$28m, which was equivalent to a tax rate of minus 1.5%. Mining paid NZ$486 million, while industry overall paid NZ$9.7 billion tax and individuals paid NZ$23 billion in personal tax. IRD's figures showed agriculture, including forestry and fishing, paid NZ$319 million in tax in 2009. If they are facing dire financial trouble then we as a nation are in the poo." "Either we have a sector in dire financial trouble or the sector is simply writing off a lot of income against expense and not paying tax," Nash was quoted as saying. Nearly 40,000 of the 72,000 companies in the primary sector were unprofitable. The data showed that 9,014 or more than half reported a loss for the 2008/09 year and 2,635 reported trading income of between NZ$1 and NZ$20,000. IRD figures showed the 17,244 entities registered as being in the dairy sector, including companies, trusts and individuals, paid only NZ$26 million in tax. 'Dire financial trouble, or writing off income against expenses' nz understands the changes would be minor, technical changes made to ensure tax could not be avoided on some aspects of farm business. Inland Revenue Department figures provided to Labour MP Stuart Nash show the average tax paid by dairy farmers in the 2008/09 year was NZ$1,508, despite the average Fonterra payout being over NZ$500,000, the Dominion Post reported.įinance Minister Bill English this morning moved to defend farmers who were operating within the rules, saying that year was particularly bad in terms of a low Fonterra payout, but signalled changes will be made in tomorrow's budget to "specifically tighten the taxation of farmers further," although he would not go into more detail.
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