Ato To Give Agribusiness Investors Advice On Living In Taxing Times

The Age

Thursday February 15, 2007

NASSIM KHADEM, CANBERRA

TAX Office and Department of Agriculture, Fisheries and Forestry officials will meet agribusiness investors at a conference in Melbourne next month to advise them on how growth in horticultural investments can be sustained.

Despite the Howard Government's decision to scrap tax breaks for managed investment schemes - and a possible court case between the ATO and the industry on the legitimacy of businesses applying for the schemes - the Tax Office will speak to agribusiness investors in Melbourne on March 20 and in Sydney on March 22.

At a Senate estimates hearing yesterday, it was also revealed that the Government had not consulted the Department of Agriculture, Fisheries and Forestry on the impact of removing the tax concessions, despite industry warnings about job losses in rural Australia. The department's corporate policy chief, Allen Grant, said it had not given Agriculture Minister Peter McGauran advice about the effect of scrapping the tax breaks, which cost the Government about $1.3 billion annually.

Revenue Minister Peter Dutton last week announced the ATO would no longer issue product rulings for non-forestry managed investment schemes from July 1, causing outrage from Liberal backbenchers and industry. Prime Minister John Howard is now considering a year's transitional arrangement, to allow thousands of contractors enough time to restructure their business.

But the heads of major MIS lenders - including Great Southern Plantations, Timbercorp and Macquarie Bank - yesterday wrote to the Prime Minister urging him a three-year transition period to avoid job losses.

The Government is consulting its back bench and industry about a compromise. Talks on the industry's future will also feature heavily at next month's conference. A brochure says it will provide "essential insights and industry developments affecting agricultural investment" and "look in-depth at the long-term sustainability of this asset class, given the drought, land use and diminishing water levels".

It says two ATO staff - Ian Munns, national manager tax planning products, and John Anderson, director technical issues - will attend to discuss product rulings and "the ATO's current approach to MIS".

The Tax Office was contacted yesterday and confirmed two officials would be attending.

"At this stage we envisage no change in attendance . . . and no change in the program," an ATO spokeswoman said.

A senior official from DAFF, Tony Bartlett, will also attend to talk about opportunities available for forestry-related MISs, which the Government supports.

Liberal ministers including Federal Treasurer Peter Costello and Agriculture Minister Peter McGauran oppose the tax concessions available under non-forestry MIS, blaming it for pushing up land and water prices.

But Labor agriculture spokesman Kerry O'Brien wants a Senate inquiry to determine the social and economic impacts of dumping the tax breaks.

© 2007 The Age

Back to News Index | Back to Home