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Carbon sink dissent costs Nash parliamentary secretary job.

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RN PM Carbon sink dissent costs Nash parliamentary secretary job


MARK COLVIN: The Nationals' split on tax breaks for planting new forests or so called "carbon sinks" has cost a Senator her position as a shadow parliamentary secretary.

The Nationals senators are joining the Greens to vote against the tax deduction, arguing the measure will see trees grown on prime agricultural land, cut food production and destroy rural communities.

The legislation will still go ahead because the two major parties, Labor and Liberal, support it but the Nationals senators' decision to cross the floor is causing a headache in the Coalition.

From Canberra Alexandra Kirk reports.

ALEXANDRA KIRK: The tax breaks for planting forests to soak up carbon are part of the Government's plan for an emissions trading scheme but the Nationals in the Senate are taking a stand against the tax deductions, arguing they'll rob the major agricultural regions of valuable food production by artificially inflating the price of land. They're vowing to vote to disallow the carbon sink tax regulations to render the changes to the Tax Act unworkable.

And just to make sure, they'll also support expunging the effects of the upfront deduction via a separate Tax Law Amendment Bill.

BARNABY JOYCE: It might not be unusual for Hong Kong not to be able to feed itself, but for Australia with 21-million people and the size of Western Europe having to import more and more of its food really starts to call into question what we're up to.

ALEXANDRA KIRK: National Senate leader Barnaby Joyce is leading the charge.

BARNABY JOYCE: Why are we having those who can afford the tax the most getting a tax deduction to be payed by those who can afford it least? Remember a tax deduction for a major organisation to get a carbon sink becomes the tax that has to be paid by other members of the community, and I find that unfair.

Secondly, as we start to remove prime agricultural land that's sustained local communities, we make the purpose of the regional town that sits in the middle of that not present. This ultimately means that the economy of the local town starts to fall to pieces. And I think that's very unfair considering it happens not by reason of global economic but by reason of a domestic tax policy.

ALEXANDRA KIRK: Barnaby Joyce says all four National senators will cross the floor and that Country Liberal Party Senator Nigel Scullion from the Northern Territory, who sits with the Nationals, will abstain. That will save his shadow Cabinet position but Nationals Senator Fiona Nash won't emerge unscathed. She's had to relinquish her position as shadow parliamentary secretary for water resources and conservation.

FIONA NASH: I've offered my resignation to the leader as a member of the shadow team but my focus is well and truly on making sure that I make the right decisions as I see it and as the Nationals see it for the future of rural and regional communities.

ALEXANDRA KIRK: Has your resignation been accepted?

FIONA NASH: My resignation at this stage has not been acknowledged but I am understanding that it will be accepted.

ALEXANDRA KIRK: Is it a costly decision for you? Because the Liberals and Labor will actually vote for it and therefore your decision to vote against the regulations will have no effect.

FIONA NASH: I believe that when you make decisions, and certainly in my role as a Nationals Senator, you have to make those decisions on what you believe is the right thing to do. And my role is to make sure that I do what I believe is the right thing for our rural and regional communities. It may have been costly in one sense but far more costly not to do what I believe is right for those communities.

ALEXANDRA KIRK: The Nationals are voting with the Greens who got the ball rolling. But that isn't enough to sink the scheme because the Liberals and Labor are voting to support it. It's the first revolt for Opposition leader Malcolm Turnbull. He says he's resigned to the fact that the junior Coalition Party has a different view.

But the carbon sinks issue has also split the Nationals. Nationals MPs in the House of Representatives, including the party leader Warren Truss, voted with the Liberals. The policy after all originated with the Coalition when it was in government, when Mr Turnbull was environment minister.

But that hasn't swayed Fiona Nash and her Senate colleagues.

FIONA NASH: I certainly don't have a problem with carbon sinks going ahead on any land across the country. Where we do have the problem is to give companies a tax break for doing it.

BARNABY JOYCE: No, not so much a change of heart. I've always thought it was a bad idea. If people believe that carbon sinks are going to work then why do we need an upfront tax deduction at all? Let the market look after it. When it becomes

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viable people will plant them. I've got no problems with people planting them from fence to fence on their own private land if they so wish. But if we're using a tax policy to put out of business regional towns, to put up the tax burden for Australian households, to push up the price of food inflation in the shops so that any person with a shopping trolley has to pick up the bill, to increase our reliance on imported food, then I think that's a stupid piece of legislation and should not be supported.

MARK COLVIN: Barnaby Joyce, Nationals leaders in the Senate. PM understands the Opposition leader Malcolm Turnbull will accept Senator Nash's resignation as shadow parliamentary secretary.

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