6. Question No. 6—AgricultureHon NATHAN GUY (National—Ōtaki) to the Minister of AgricultureQuestion No. 6—Agriculture6. Hon NATHAN GUY (National—Ōtaki) to the Minister of Agriculture: Does he stand by all his statements? Hon DAMIEN O'CONNOR (Minister of Agriculture): Yes. Hon Nathan Guy: Does he stand by his statement last year to Rural News that when it comes to increasing costs on farmers they should—and I'll quote—get used to it"? Hon DAMIEN O'CONNOR: Our Government is clearly committed to increase water quality to commit to climate change international obligations and to put farmers in a more sustainable space for their production. I have been honest with them and said some of those things may cost farmers but what we will do as a Government is assist them get more for everything that they produce and sell. Hon Nathan Guy: Does he stand by his statement on Radio New Zealand on 22 February that "capital gains is the ultimate goal of a farmer" and was that based on any official advice? Hon DAMIEN O'CONNOR: What I did say—and I'd need to clarify what the member has said—is that for many farmers it has been the ultimate goal that they have been prepared to work for a 2 percent return on their equity in the hope that at the end of the day when they finish their 20- or 30- or 40-year farming career when they sell up they'll have enough money to retire. In the 1980s when one of the previous National Governments was highly subsidising the productive sector the farmers they were capitalising into the value of the land all of those subsidies and farmers were advised at that point to stop farming for capital gains. A brave Labour Government took off subsidies. If that member is now proposing to put subsidies back on to farmers he should front up with it. Hon Nathan Guy: When he said on Radio New Zealand last night that "farming for capital gains is flawed and it's something that needs to be looked at" does he support implementing a capital gains tax? Hon DAMIEN O'CONNOR: I won't get into the detail of what is an independent report that Government is currently considering and will be consulting on across the sector. I stand by my statement that if farmers are farming for capital gains it is a flawed approach. The biggest challenge in agriculture at the moment is succession and that is the ability to pass farms on into the hands of young New Zealand farmers. That is getting increasingly difficult and what might happen were a capital gains to be brought in is that it may mean that farms are more affordable for young New Zealanders and that would be better for New Zealand. Hon Nathan Guy: Thank you for that. How will the Tax Working Group recommendations of a capital gains tax a water tax a fertiliser tax a nitrate tax and an agricultural emissions tax have an impact on already low—Hon Grant Robertson: I raise a point of order Mr Speaker. That list of things in the member's question is simply not—a number of them are things that are not in the Tax Working Group report. SPEAKER: As long as I have the assurance of the Hon Nathan Guy that they are all recommendations in—[Interruption] No I'm prepared to take the member's assurance. It would be very serious if it was breached. He can rephrase his question if he wants to but he will ask his question again and I will accept him at his word. Hon Nathan Guy: How will the Tax Working Group discussion points and recommendations of a capital gains tax water tax fertiliser tax nitrate tax and animal emissions coming into the emissions trading scheme impact on farmer confidence that is already at an all-time low since 2009? Hon DAMIEN O'CONNOR: The independent Tax Working Group has put out a report that we are considering comprehensively. Can I say that farmers will look with some concern at some of those recommendations. That's why the Government will work through it carefully. If it's anything to go by the huge crowd of about 15 people who turned out to that member's meeting yesterday indicates that there's not a huge amount of concern out there. What I would like to do and request is that that member tables the calculations upon which he based his ridiculous assertions around the cost to individual farmers. What the Tax Working Group hasn't specifically recommended is an increase in GST a brightline on capital gains taxing employer KiwiSaver contributions a border tax tobacco tax rises digital purchase tax and numerous increases in petrol taxes. They were all taxes imposed on the rural sector by the last National Government and it didn't ruin the rural sector."