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What would the Greens’ inheritance/gift tax mean for farming?

Written By: - Date published: 8:07 am, May 20th, 2025 - 48 comments
Categories: Chlöe Swarbrick, farming, farming - Tags: , , ,

Green Party co-leader Chloe Swarbrick was on Q&A on Sunday, fronting up to Jack Tame’s questions about the Greens’ alternative budget.

I was looking forward to this, because I had a lot of unanswered questions from the budget release last week. One of the main ones was around family farms and the wealth transfer or inheritance/gift tax.

Video below, timestamped to the start of the question about farming.

Farming is central to everything else. Growing food is fundamental to human wellbeing in ways we don’t think about enough: if we don’t grow food, we go extinct. That might seem silly to say but in New Zealand we treat farming primarily as an export earner rather than as domestic food security and resiliency.

As we go deeper into the climate crisis this will change, food security will matter in ways we are not used to. We already have a cost of living crisis around the price of staple foods like meat and dairy. When extreme weather events and unusual weather seasons start to cause crop failures globally and locally, how we manage farming will matter a great deal.

A green vision of societal transformation that includes mitigation of climate change, adaptation to what is already locked in, and transition to sustainable economies and lifestyles, has to include protecting family farms from corporate take over, as well as opening the door wide to regenerative and other resilient methods of food production.

Without those we can’t transition to a climate sane world. Farming should not be seen solely as an element of our export economy, but foremost as a national strategic asset. The financial viability of family farms matters a great deal.

The Greens’ policy document (PDF) is light on detail, but says,

… a 33% wealth transfer tax will apply to significant gifts and inheritances received, over an accumulated lifetime threshold of $1,000,000, similar to Ireland’s Capital Acquisitions Tax.

There’s an explanation of Ireland’s CAT here, it’s complex, but notable is the inclusion of the ‘agricultural relief’ clause, which allows hands-on farmers to pay less tax when they inherit. Also a factor is that the tax is on what is being inherited (not what is gifted overall) and inheritances are often split between multiple people. In addition, many farms carry debt. The tax would be on net assets over $1 million.

Swarbrick doesn’t have a lot of answers on the details, but does name two important things,

  • we don’t have good data in New Zealand on the number of farmers that would be affected and how. Part of the goal here is to open the conversation so we can talk about who has wealth and what it looks like.
  • she wants people to engage with the policy and bring the problems with it to the party. I hope there are farmers that will do that.

Within that it seems possible to protect family farms and have a wealth transfer tax, but at some point the Greens are going to have to make it explicit that they support farmers not just workers and beneficiaries.

I cringed a bit at the initial response from Swarbrick to Tame’s quite reasonable question about how farmers would afford a 33% tax on a five million dollar farm (the average farm value). She said most people in New Zealand will pay less income tax and most people don’t have that kind of wealth. I mean, sure, but farming by its nature is done by a small % of the population, they’re never going to be most people.

Do we want to treat family farms as an abstract, for-profit, wealth accumulation business? Debt is already a massive block to farmers transitioning to organics or regenerative agriculture. This positioning from the Greens appears to be in conflict with their climate and farming policies. How much of that tax payment would be taken away from private riparian restoration or reforestation projects? Or workers’ wages?

Sawrbrick is right, we need the data. Details (from the relevant data collection, and from the Greens on their policy) would go a long way to improving the debate around farming and wealth in New Zealand, and closing the rift between farmers and greenies, or rural folk and townies.

To be fair, Swarbrick then goes on to say,

This is the point of putting this forward, so that we are able to say hey look, if there are serious issues that people can foresee, let’s deal with the evidence, let’s deal with the data. And I’m looking forward to getting in front of farmers and agricultural audiences.

It’s possible that the threshold or % is off. The first iteration of the original wealth tax set the threshold too low and the Greens changed that the next time around. What we could be doing here is taking the bones of their tax policies and figuring out how to make it work.

48 comments on “What would the Greens’ inheritance/gift tax mean for farming? ”

  1. bwaghorn 1
    20 May 2025 at 8:39 am

    I don't get a sense that many farms a inherited in this modern age, there is a whole industry around farm succession planing, and the farm is usually bought out by the farmer in the family while paying out the the other siblings ,

    Reply
    • weka 1.1
      20 May 2025 at 9:37 am

      that's what I thought too, but have seen a farmer saying it's not true, there are still inheritances going on (because who can afford to buy out a farm now?). This is where the actual data and knowledge of what is happening is needed.

      It's also a big problem where next generations are having to take on so much debt to keep farming. But how to be fair to all the siblings is a problem for sure, and I'm guessing that gets compounded with each generation if the debt gets passed on. I'd also like to know how many farm businesses fail because of that.

      Reply
      • bwaghorn 1.1.1
        20 May 2025 at 9:53 am

        I can't add much really , other than tax inherited money seems miserable, if the the tax has been paid while it accumulates ,

        Reply
        • weka 1.1.1.1
          20 May 2025 at 9:58 am

          tax is paid when the wealth transfers, not as it accumulates. Maybe it should be a tax on sale, that might encourage farmers to actually leave farms to family instead of selling it to them. But either way, it's skimming the top off the wealth, where wealth has accumulated largely because of the property market. Same shit as the housing crisis really, and the need for a land tax of CGT.

          Reply
          • alwyn 1.1.1.1.1
            20 May 2025 at 10:19 am

            I think that what is being commented on is that the value of the property is derived from the money that was spent on it and that is what was left after tax was paid when it was first earned.

            Thus you pay tax on the original earned income and then pay tax again on those savings. It might be true but it isn't any different from any taxes on Capital or indeed for the tax you pay in interest received when you loan out your savings via a term deposit or a savings account. I don't see how you could justify excluding any of` the types of income from tax, provided that the income is actually received.

            Reply
      • Cricklewood 1.1.2
        21 May 2025 at 8:25 am

        My cousin has inherited the family farm but his sister gets a share of the returns and half the value if it's ever sold. The farm itself is financially viable in that it provides a living and some capital to reinvest, it's not organic by any stretch but my Uncle was an avid Forest and Birder who took a 'soft' approach and expended considerable time and money replanting and retiring a lot of the more marginal land and riparian areas.

        If there was an inheritance tax without doubt either the farm would have to become far more intensive to generate enough income to pay the tax or be sold and the hills planted into pines and intensive dairy on the flats.

        Need to very careful how it would be approached so we don't end up pushing farms into the hands of big industrial players which would play by different rules.

        Reply
        • weka 1.1.2.1
          21 May 2025 at 10:27 am

          very much this.

          We need to start talking about the different kinds of farm businesses, looking at which have debt and which don't, and what happens when farms are sold outside of the family.

          Reply
  2. Ad 2
    20 May 2025 at 9:00 am

    Mate the Greens are going to get almost zero dairy farmer votes. Dairy farmers hate the Greens. Don’t worry about them.

    The good news is like Fonterra and iwi business, they can't go anywhere. Their capital is immobile. So dairy farmers can get taxed and get fucked.

    Reply
    • bwaghorn 2.1
      20 May 2025 at 9:21 am

      Why ti win freinds and influence people 😅

      Kinda agree though

      Reply
    • weka 2.2
      20 May 2025 at 9:34 am

      Sure, but in order to tax farms, you have to convince Labour, and that's a bigger voting base. It's not about converting greenie hating dairy farmers, it's about building a consensus in NZ that is't ok to tax wealth including farms.

      It also needs to be fair (otherwise people won't vote for it), and functional. Telling dairy farmers to get fucked and taxing them so they end up selling their farms, who buys them and what happens to those farms?

      Reply
      • Res Publica 2.2.1
        20 May 2025 at 9:53 am

        Sure, building consensus matters.

        But in defense of the 95% of New Zealanders who aren’t farmers: when the public asked the sector — especially dairy — to start paying for the environmental damage it causes, like every other business, the response wasn’t reasoned debate.

        It was outrage. Threats. Crackpot conspiracies.

        We got Groundswell.

        We got death threats against public servants.

        We got one of the most shameless displays of special pleading in our political history. Turbocharged by right-wing money and semi-legitimized by a handful of opportunists in ACT and NZ First.

        If the public seems hesitant to make exceptions for agriculture now, maybe it's because the sector told them to get fucked first.

        Reply
        • weka 2.2.1.1
          20 May 2025 at 10:04 am

          are you suggesting that Groundswell is representative of NZ farmers generally?

          It's valid and reasonable for people to be angry with the farming sector over climate, the environment, and rural land prices (I am). I just think the solutions lie elsewhere than telling farmers yeah, nah, get fucked. I can't see how that would work except by building more animosity towards rural people.

          Reply
          • Res Publica 2.2.1.1.1
            20 May 2025 at 10:28 am

            I just think the solutions lie elsewhere than telling farmers yeah, nah, get fucked. I can't see how that would work except by building more animosity towards rural people

            But here’s the thing: I’ve been a progressive my whole life. And I’ve spent years swallowing the snide comments, the sideways looks, and the patronising lectures from rich kids who think they’re better than me because their dad owned six farms. Mine only managed one of them.

            Now they’re the local lawyers, accountants, or farm advisors, straight out of uni and into cushy jobs through mummy and daddy’s friends. And they’re still the same insufferable snobs.

            So yeah. You bet I want to tell them to get fucked.

            But I also want to build something better. Something fair. Something that actually works: for rural people, for tangata whenua, for working families, and for the planet.

            That won’t happen if we keep treating rural wealth like a sacred cow, and farmers like they’re a privileged class whose respect must be earned, even when they refuse to give any in return.

            And it definitely won’t happen if we keep letting inherited privilege dress itself up as hard work.

            So no, it’s not about telling all farmers to get fucked.

            It’s about telling entrenched power: your free ride is over.

            Yes, this is an intensely personal and probably irrational hatred. But I'm far from the only nerdy, weedy kid from a small town who lived through the experience of humilation and exclusion.

            Reply
      • Ad 2.2.2
        20 May 2025 at 10:10 am

        No one knows what "fair" means in tax. It's a non-word.

        Good luck persuading Labour but if they were honest they pretty much get no dairy farmer votes as well. Federated Farmers and DCANZ are just a roadbump to drive over.

        Reply
        • weka 2.2.2.1
          20 May 2025 at 11:35 am

          we know what unfair is, and how to have a conversation about it.

          The Greens are in the process of shifting the overton window on tax, just like they shifted it on poverty and climate. Labour follows and then implements a more mainstream version that is palatable to the electorate. But it takes the Greens to make that possible.

          Reply
  3. mikesh 3
    20 May 2025 at 9:35 am

    Perhaps land should not form part of inheritable wealth, for the purpose of wealth tax calculations, but should be subject to an annual land tax instead.

    Reply
    • weka 3.1
      20 May 2025 at 9:40 am

      pretty sure farms over a certain net value would be taxed by the main wealth tax as well (which from memory was an annual payment unless deferred). But I heard farmers at the time saying the wealth tax would be a heavy burden on farm businesses too. The out of control property market of recent decades has really fucked the economy in so many ways. The land shouldn't be worth that much, but now that it is, it's hard to find the balance of fairness.

      Reply
    • Res Publica 3.2
      20 May 2025 at 10:30 am

      but should be subject to an annual land tax instead.

      Isn't that rates? Although councils have tended to try and pander to farmers a bit via rating differentials.

      Reply
      • mikesh 3.2.1
        20 May 2025 at 11:11 am

        but should be subject to an annual land tax instead.

        Isn't that rates? Although councils have tended to try and pander to farmers a bit via rating differentials.

        No. Rates are paid to local authorities while tax is paid to central government (though of course this seems too obvious to be worth pointing out). What we are discussing are what should be the sources of central government revenue.

        Reply
    • SPC 3.3
      20 May 2025 at 9:08 pm

      Farmers are more able to pay tax when they sell, their problem is operating cost and land taxes would just add to that.

      Reply
      • mikesh 3.3.1
        21 May 2025 at 9:16 am

        Land taxes Would of course be deductible for tax purposes, and in addition there would probably be an income tax rate reduction if a universal land tax was applied.

        Reply
      • mikesh 3.3.2
        21 May 2025 at 9:25 am

        I would like to add that if a farmer can afford to pay a lot of interest then he can certainly afford a land tax. The real problem as I see it is usury not tax when it comes to affordability. With a freehold farm land tax should not be a problem.

        Reply
      • mikesh 3.3.3
        21 May 2025 at 10:03 am

        AJ's comment at 5 below, which includes a Richard Murphy video, may also be relevant in our situation: i.e. if land is overvalued, we should taking steps to reduce its value rather than taxing it through inheritance tax.

        Reply
      • Shanreagh 3.3.4
        21 May 2025 at 7:46 pm

        Yes SPC that is the key point.

        Taxes charged on wealth along the way to an enterprise just impose a cost on the players that in many cases they have little or no ability to meet. If you have looked at a farm budget you will know that wealth does not come every year but that expenses do. Without the ability to have arrangements with stock firms for overdrafts extending over many years many farmers would be/are facing technical bankruptcy.

        Indeed in many sheep farming communities it is a point of history that the Korean wool clip set many farms/families up to where they are today. Families still farming pass farms on relatively easily. For new entrants to sheep farming it is diabolically hard to get a foothold into a sheep farm and then to make a decent living. Some farmers have been entitled to benefits from WINZ.

        In my view this is the reason that The Greens Wealth tax paying as you go is not as easy to administer etc as a tax at the time the property is sold. Putting a tax on at the time of transfer (ie sale) is easy to legislate and to administer and not as easy to work around.

        A tax at the time of sale can be charged to rural or urban dwellers. I would call it a land tax or death tax. Urban dwellers also have little ability to meet a wealth tax pay as you go. They also don't have a financier like a stock firm. Sale or death provide convenient way points when property ownership is in transition. Taxes around land can be imposed then.

        Then there is a land-amassing farmer or forestry outfit. These are a different beast (ha ha) than the working farmer. Many properties are bought that have the whole range of buildings. Very few of them are used by the land-amassing farmers. You don't need them all for housing farm workers. So they become vacant, then the fences are moved up to right around the house, then derelict, or the back is knocked out for a handy garage or for an informal hayshed. Sometimes though, the houses are rented out and become the places where drugs are introduced/entrenched to the district by renting to ne'er do wells.

        To prevent land being amassed there needs to be controls on land aggregation. In the olden days, when I started work, legislation seemed to prevent the worst of land aggregation.

        The now repealed (from 2018) Land Settlement Promotion & Land Acquisition 1952 had clauses relating to the matters to be taken into account in deciding whether 'the acquisition of farm land will amount to undue aggregation'….'provides that the Land Valuation Committee is to have regard to the question whether the farm land owned by the purchaser or lessee is sufficient to support him and his wife and dependent childen in a reasonable standard of comfort".

        In my view the ship has sailed on

        – preventing aggregation of land by other than tax means which it may do incidentally at the time of the death of the farmer where land is sold to give assets to other beneficiaries

        – legislation preventing aggregation. It was a piece of legislation that was, for some, easy to get around by the usual mechanisms of company structures, Trusts etc.

        Whether to include farming enterprises in any Wealth/CGT is part of the conversation around whether we need Wealth/CGT.

        Reply
  4. Res Publica 4
    20 May 2025 at 9:40 am

    Thanks for this.

    There’s a lot of value in your analysis of farming as a strategic asset. Especially as climate instability accelerates.

    But let’s not kid ourselves about where we’re at.

    Yes, agriculture is critical. But right now, the sector is its own worst enemy: blundering, tone-deaf, and wildly insecure. It clings to an overinflated sense of self-importance while demanding handouts, resisting regulation, and offloading environmental costs onto everyone else.

    We’re constantly told we mustn’t offend rural New Zealand: that we need to “bring them along.” But these are the same people who, only a few years ago, were publicly discussing raping and hanging the “communist” prime minister because she asked them to wear a mask and be kind.

    Why are we tiptoeing around the tender sensibilities of the lucky few to protect the birth of a new landed aristocracy?

    If the goal is to save family farms, we’re about 35 years too late. Our small towns have already been hollowed out. Where there were once thriving communities with a hall and a school, there are now just six, seven, or eight farms, all owned by the same family.

    I see it every day. It’s a ten-minute drive from my lifestyle block to my kid’s rural school: a school that’s only survived because the community fought tooth and nail to keep it alive.

    And for that entire drive, I pass through land owned by one family.

    That’s not resilience. That’s not “family farming.” That’s feudalism with diesel engines.

    Most of our Pākehā ancestors came here to escape the tyranny of inherited privilege. Yet now we’re expected to coddle the next generation of dynastic landowners while they inherit multimillion-dollar farms tax-free and treat any call for fairness as persecution?

    A wealth transfer tax is the bare minimum. If it breaks up five- or six-farm dynasties and creates space for new entrants: including Māori landowners, regenerative producers, and smallholders, then good!

    Let’s stop pretending that if the left is just gentle enough, or clear enough, or brings enough data to the discussion, farmers will come around on their own. There’ll be plenty of time to talk with Federated Farmers, and the bloated, state-sanctioned monopoly that is Fonterra when there’s a Green, Labour, or (God forbid) TPM Minister of Agriculture.

    But for now, we need clarity.

    In a system under pressure, participants either innovate, or die. The agriculture sector is no exception. It’s time they learned that.

    Reply
    • weka 4.1
      20 May 2025 at 10:02 am

      ok, sure, there's truth in there. But as someone who also lives in a small rural community, I feel the need to push back on the representation of farmers as a monolith.

      Haven't checked lately, but afaik most farmers aren't members of Fed Farmers. So I think about the small farms that are trying to do the right things around riparian planting, or who might still spray but are trying to change their practices, or farming families who are still the backbone of rural life and community.

      Those farms would get caught in the blunt end of this tax simply because property prices rose astronomically in the past few decades. Do the sums, it's not hard to see how an inheritance tax would push more of those farms to be sold simply because of the finances. Who will buy them? Maybe Iwi, but it's hard to see small holders and regenag people being able to. It's likely those family farms would consolidate to the uber wealth farm owners.

      Which brings us to the data. Because it might just be a matter of the threshold being too low (by all means go for the multiple farm hoarders and big ag owners). Or needing an ag relief option. Or some other solution which we cannot design because we don't know what the situation is in reality.

      The solution to the kind of farming you are pointing to, eg one family owning all the farms in a valley, is to address that problem as part of a strategy. If farms are a strategic asset, then let's regulate to make that more fair and more viable.

      Reply
      • Res Publica 4.1.1
        20 May 2025 at 10:18 am

        But as someone who also lives in a small rural community, I feel the need to push back on the representation of farmers as a monolith.

        I feel you.

        I grew up rurally too. Most of my friends and neighbours were (and still are) farmers. Some are genuinely environmentally minded, concerned about the long-term, and doing what they can with the tools and margins they’ve got.

        A few others? Spoiled, entitled, third-generation gentry who moan about “bloody Māoris” at the pub and prefer to hire Filipinos because they’re easier to exploit and don't complain when they violate employment laws.

        I’m not trying to paint farmers as a monolith. But I am saying the system itself is broken. From land pricing and water rights to inheritance norms and emissions. And it’s that system, not individual good actors, that we have to be brave enough to confront.

        You're absolutely right about the need for a strategy. And the thing is, we’ve been here before as a country.

        At the turn of the 20th century, New Zealand’s Liberal government took on the sheep barons: large landowners who were hoarding land and wealth while the rest of the country struggled to get a foothold.

        John Ballance argued for taxing what he called the "unearned increment": the rise in land value that came not from the owner's work, but from public investment and national growth. It was a way to break up monopolies and reward productivity, not inheritance.

        Richard Seddon carried that vision forward. He made the stakes plain:

        “It is the rich and the poor; it is the wealthy people and the landowners against the middle classes and the labouring classes.”

        They passed the Land for Settlements Act, they taxed idle land, and they regulated ownership in the public interest.

        It wasn’t perfect. But it was bold, and it was necessary at a time where farmers wielded the kind of political clout the feds can only dream of.

        And clearly it can't have been that deleterious. 120 years later, he's still our longest serving Prime Minister. The man's even got a statue outside of Parliament.

        If we treat land and food systems as strategic assets, then we need the policy tools to reflect that. A wealth transfer tax could be one. But as you've pointed out, that only works if it’s fair, well-targeted, and part of a broader plan that prevents consolidation up into corporate hands. Otherwise, you're right.

        We might just accelerate the very concentration we’re trying to stop.

        Let’s fix the system and protect the people doing good within it. But we can’t keep treating agriculture as sacred and untouchable while everything else burns.

        This isn’t an attack. It’s estate busting 2.0.

        Reply
        • Tabletennis 4.1.1.1
          20 May 2025 at 1:26 pm

          Inheritance tax can be made fairer based on the relationship to the deceased e.g:

          “Dutch Inheritance tax: percentages for partners and children vary from 10% to 20%; Inheritance tax percentages for grandchildren and great-grandchildren vary from 18% to 36%”
          https://www.google.com/search?client=firefox-b-d&q=dutch+inheritance+tax

          I agree that growing food for local consumption is an asset that needs protection. However, currently there seem to be too much take by the farmers lobby and not enough give.
          e.g.Groundswell has just started a new campaign: We have to quite the Paris Agreement. They argue among other things:

          "In fact, trying to comply is completely counterproductive. Any reduction in NZ exported food means some less regulated, less efficient farm somewhere in the world replaces our products while putting out more emissions."

          "That’s why it’s time to pull out of the Paris Agreement all together."

          https://www.groundswellnz.co.nz/news/we-have-to-quit-paris

          Reply
  5. aj 5
    20 May 2025 at 11:25 am

    It was only 6 months or so ago that UK farmers took to the street in protest about changes to the inheritance tax relief for farms.

    A typical headline (BBC) at the time:

    https://www.bbc.com/news/articles/c1ml5zm9lz5o

    Farmers across the UK have met the news that inheritance tax relief for farms will be limited to £1m with anger.

    The National Farmers' Union said it had been a “disastrous budget” for family farms, that would “snatch away the next generation’s ability to carry on producing British food” and see farmers forced to sell land to pay the tax.

    Many have gone onto social media to express their dismay, as well as broadcasters Jeremy Clarkson and Kirstie Allsopp, who said the decision showed the government had "zero understanding of what matters to rural voters".

    Richard Murphy picked apart the proposal here and began this short clip thus:

    We need to talk about farms, we need to talk about farming economics, we need to talk about inheritance tax and we need to talk about why all these issues are related. Farmers are up in arms and are complaining about their tax bills

    Let me tell you that I first worked for a firm of accountants in East Anglia more than 50 years ago now and at that time farmers were up in arms and complaining about their tax bills this is the normal state of farming in the UK.

    Farmers are not happy people by definition it seems they will always find something to be mad about and the government and tax bills will always be high on that list so let's not get overly upset about the fact that farmers are suddenly getting a bit angry about the fact that labor has had the temerity to impose a very small inheritance tax charge on them which is much more favorable than that which is
    going to be paid by the rest of society on their homes of their assets and so on

    New Zealand farmers are no different from this. Expect similar treatment and misinformation from the RW on this from now until the next election. The greens (and by extension Labour) are going to have all the answers to counteract this and could do worse than look very closely at the UK experience.

    Reply
  6. AB 6
    20 May 2025 at 12:17 pm

    Perhaps inheritance tax could explicitly distinguish productive assets of national significance (PANS) from non-productive assets. PANS would be things that we want to keep in a productive state like most farms, but which we don't want to see accumulating in fewer and fewer hands causing concentration of political power. Non-productive assets would be things like idle land and houses.

    PANS could have a limited carveout – perhaps in the form of a higher threshold point and lower tax rates. And inheritance tax could also be progressive as the total value of assets increases – again to avoid ownership concentration.

    Though no doubt there would be massive arguments about what's a PANS and what isn't, along with a proliferation of scams and evasion – at least until a subsequent NatACT government either loosened the definition to the point of uselessness or chucked the whole thing out.

    Reply
    • Res Publica 6.1
      20 May 2025 at 2:27 pm

      That’s veering dangerously close to the state picking winners, isn’t it? And while I’m all for regulating the ever-loving daylight out of capitalism, I’m not convinced the government should be in the business of deciding which assets are productive enough to deserve softer treatment.

      That’s a slippery slope. Especially when political cycles guarantee any half-decent framework will be gamed, gutted, or greenwashed into irrelevance.

      Better, maybe, to keep the tax structure simple, progressive, and difficult to dodge. Then let the chips fall where they may.

      Reply
      • AB 6.1.1
        20 May 2025 at 4:06 pm

        Yes, I think you're right. It's tempting to add complexity to a tax system because we want to make nuanced distinctions – say between productive and non-productive assets. But complexity probably increases the opportunities for gaming and discredits the whole thing.

        Reply
  7. Adrian 7
    20 May 2025 at 1:23 pm

    The problem with a tax on a farms value is exactly what is being taxed. If a farm is taxed annually at say 15% of its inflated capital value then that amount comes very close to being well in excess of the value of its production, let alone its profit, with the possible exception of some larger dairy farms, smaller ones struggle in most years to be seriously liquid the problem being of scale. This is the problem in my industry, grapegrowing, we are only 11ha therefore it is only marginally profitable, in fact in most years we struggle to break even..The problem is that the visible value of a farm is that the seriously wealthy in the world see NZ farms in particular as a bolt hole, and are prepared to pay many, many multipules of it's productive value. If you were to tax a farm at a rate in excess of what it could produce it would only be a few years before its inevitable sale to new owners of comsiderable wealth whose allegiance is not to this country. Say what you like about farmers but they are virtually without exception loyal New Zealanders who are proud that they are earning export dollars that are helping their, and our country.

    Reply
    • Res Publica 7.1
      20 May 2025 at 2:24 pm

      Say what you like about farmers but they are virtually without exception loyal New Zealanders who are proud that they are earning export dollars that are helping their, and our country

      That’s an interesting way to frame it…

      What exactly does a “disloyal New Zealander” look like? Is it someone who lives in a city? Works in a different industry, like law or software? Or is it just someone who isn’t farming?

      Loyalty to this country isn’t the exclusive domain of any one group. Plenty of New Zealanders: urban and rural care deeply about our national wellbeing and contribute in meaningful ways, including paying taxes, building infrastructure, creating jobs, and yes, exporting goods too.

      So while I respect the pride many farmers feel in their work (and rightly so), I think we should be careful not to draw a moral divide between one kind of Kiwi and another. Especially when the conversation is really about fairness in how we tax wealth and land.

      Not about who loves New Zealand more.

      And while I absolutely acknowledge that many farmers work hard under tight margins and make a genuine contribution to our export economy, I think it's fair to ask: export dollars for whose benefit, ultimately?

      When some in the industry use mechanisms like trusts or strategic accounting to minimise tax, perfectly legal though they may be, it raises real questions about how much of that value is flowing back into the public good versus being locked up in private wealth.

      It becomes a harder sell to justify special treatment when the tax contribution doesn’t align with the level of asset ownership.

      I also agree that taxing land value without considering production capacity creates serious distortions: especially for smaller, family-run farms like yours.

      Maybe the bigger issue is separating productive farmland from speculative capital value, especially with wealthy foreign buyers skewing prices. It’s a tough balance to strike: keeping land in the hands of those who work it, while ensuring the tax system is fair across the board.

      Reply
  8. feijoa 8
    20 May 2025 at 4:11 pm

    I searched, but couldn't find anything that confirmed my vague memory of reading somewhere of how little INCOME tax NZ farmers pay. I imagine they write off most of their household expenses as business expenses- vehicles, clothes, power, internet, insurance, school fees, maybe food. Buy a new tractor if it looks like a good year. Make the sums add up.

    All those things a wage worker can't.

    It seems to me the farming sector may be carrying the brunt of our export economy, but they are not bearing much brunt on out tax burden.

    Reply
    • Hunter Thompson II 8.1
      20 May 2025 at 4:50 pm

      I'm sure most farmers are carrying significant debt and find it hard going a lot of the time. I note that MPI has a farm debt mediation scheme.

      But for decades NZ farmers have worked the tax system to pay minimal income tax year on year and then take a tax-free capital gain on retirement. All perfectly legal.

      Environmental damage caused by the industry, particularly water pollution, is an externality inflicted on the community.

      It seems Labour is thinking of campaigning on introduction of a CGT but has not made a definite statement on that.

      Reply
      • SPC 8.1.1
        20 May 2025 at 7:54 pm

        I would tax the CG on the sale of the property.

        But there would need to be an exempting of the home.

        I would also lend government money (interest free) to farmers to upgrade their farms to environment standards and this is repaid on farm sale.

        Reply
    • joe90 8.2
      20 May 2025 at 5:21 pm

      how little INCOME tax NZ farmers pay.

      SFA.

      /

      Professor Lisa Marriott:

      In 2016-17, the government collected $75.6 billion in tax revenue, while the agriculture sector paid $758 million in tax. This is a large sum, but not a large proportion of tax collected. It equates to the agricultural sector contributing 1% of tax revenue in the period. If we isolate dairying from the broader industry, its contribution is 0.33% – one-third of 1%.

      https://thespinoff.co.nz/society/27-03-2019/the-claim-farmers-are-becoming-an-atm-for-beneficiaries-is-nasty-and-its-nonsense

      Mike Joy, Lisa Marriott and Simon Chapple:

      While the sector pays tax on income like everyone else, the amount paid by the dairy sector ($531.7 million in 2019/20 – or 0.7% of total tax revenue) looks to be substantially less than the costs associated with transfers from the government back to the sector and remediation of environmental damage caused by the sector.

      https://theconversation.com/the-groundswell-protest-claimed-regulation-and-taxes-are-unfair-to-farmers-the-economic-numbers-tell-a-different-story-179281

      Reply
  9. SPC 9
    20 May 2025 at 9:13 pm

    There are two taxation issues.

    1.The farm sold, CGT

    2.Farm inheritance, Estate tax.

    Reply
  10. Patricia Bremner 10
    21 May 2025 at 2:16 am

    Parker explained, wealthy New Zealanders could control or mitigate tax by having non taxed income.

    They then on average paid 9 cents in the dollar against 18 cents in the dollar for poorer Kiwis.

    So those income streams should be taxed, and a business should have progressive tax. Perhaps they will have to unload one of their farms. That would allow new comers a chance to farm.

    All wealthy people are tight in my experience

    I have found an attitude of "We worked hard", however they want to pay the lowest price/wages/fees, and that is their hobby… getting it cheap. They are proud of it. (Personal experience)

    Being wealthy enough to have a charity or Foundation, where the “gifts”can be given to those “chosen as worthy” is another tax free ploy.

    An overhaul of all tax and assets should happen

    Reply
  11. phillb 11
    21 May 2025 at 8:13 am

    Maybe we should just start charging businesses income taxes, just like us plebs. Also we used to have stamp duties and death duties, and farms seemed to still work.

    Reply
  12. Tom Hunter 12
    22 May 2025 at 5:16 pm

    It's probably a moot point given that economics is constantly forcing farms to become larger to remain as economic units. The ones that can't cope sell out, reinforcing the cycle.

    I recall local farmers scoffing at a National proposal some years ago to have Landcorp sell off its farms, because only corporate farmers could afford to buy them. We’re all well aware of National not giving a shit about “small” farmers, which nowadays means 100Ha or less. As always they like their corporate mates and the bigger the better. Another advantage they have is that they’ll be able to avoid almost anything you throw at them: these are not the sheep barrons of Seddon’s era.

    I don't know what the US situation is re estate and inheritance taxes but they have CGT and whatever the situation here is the reality of family farms in that nation since 1950.

    My kids are not interested in farming. As one said recently, "I've seen what you earn and what you have to deal with to earn it. It's not worth the candle and it's only going to get worse".

    I'll likely sell to the Maori Trust across the road since they'll easily outbid my neighbours.

    Reply

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