2 minute read
Commodity levies
Over the years that I have been working with horticultural industries, one question comes up frequently – are we getting our correct income from compulsory levies?
Ian Turk : Manager, NZ Feijoa Growers Association
The disparity between what industries expect production to be, and how much is actually represented by levy income is surprising. There are growers who oppose compulsory levies, or disagree with how levies are spent, but all levy money is spent with the benefit of growers and industry in mind.
Remember, financial accounts which are funded by compulsory levy are to be audited, and all levy payers have the right of a say on how levies are spent. Every grower should be benefitting from industry expenditure of commodity levy funds, so failure to pay will only be harming the industry good programmes of your industry.
Let’s look at the feijoa industry. Until recently we spent about half of our budget on promotion. The association could not commit to these programmes without certainty that they could be funded through yet uncollected levies on the coming harvest. Most levies are collected at the first point of sale by wholesalers, but sales of fruit by growers at the farm gate or through farmers’ markets is all eligible for levy payment. Growers whose marketers don’t deduct the levy, or who opt out of paying commodity levies are selling themselves, their colleagues and friends short. You will benefit from promotion and other activities, even though you are avoiding your statutory requirement to pay just 3% (current feijoa levy rate) of value, to have your industry body organise and pay for industry programmes that will also benefit your sales. On the local market, it is hard to know where sales are happening. We rely on your honesty – but that doesn’t mean you don’t need to pay the commodity levy. Remember, industry bodies can open up the audit procedures that are available under the Commodity Levies Act if they get frustrated enough! Referring again to the feijoa industry, our focus in recent years has moved to research as we deal with an insect pest and a plant disease that threaten to spread. The fact that we had assured income has enabled the industry to attract a total of $676,000 from the Sustainable Farming Fund for two three-year projects. We would not be able to make this commitment or attract such funding without a compulsory levy. Again, the outcomes will be available to everyone. So our plea to all feijoa growers, in fact to all growers of fruit and vegetables which are subject to a commodity levy, is to contribute the small percentage your levy comprises, and be part of the team that is working to protect and grow your livelihood. (Feijoa Growers, go to the association’s website at feijoa.org.nz, then select levy submission in the levy menu – this is a levy declaration and calculation, and provides a tax invoice for your payment.)
For more information contact Ian Turk, Manager, NZ Feijoa Growers Association, ian@feijoa.org.nz.
