The Government has fulfilled an election promise by the release, albeit more than 6 months late, of the Agricultural Competitiveness white paper on 4 July 2015 agwhitepaper.agriculture.gov.au.
With a theme of “Stronger Farmers, Stronger Economy”, the Agricultural Competitiveness white paper contains $4 billion of spending measures intended to make the agriculture sector more competitive, profitable and resilient.
We’ve summarised the five key intiatives, and what tax changes may affect you.
The white paper was developed after extensive consultation with the community, including over 1,000 submissions received in response to an initial issues paper and green paper. This is of course, the same process that the Government is currently undertaking with the Tax Reform white paper process.
The initiatives are outlined in the white paper under the following five key priority headings:
1. A fairer go for farm businesses
2. Building 21st century infrastructure
3. Strengthening our approach to drought
4. Farming smarter
5. Accessing premium markets
These priorities have been identified in pursuit of nine agriculture policy principles, with the Government’s primary focus being on better returns at the farm gate by reducing costs and unnecessary barriers to productivity and profitability.
At Crowe Horwath, we are always interested in any tax changes that might affect our clients. The white paper contains some important tax related proposals for primary producers, which are in addition to the measures announced in the recent Federal Budget – for example, depreciation concessions for small businesses for assets costing less than $20,000, and also for new capital expenditure on fencing, water facilities and fodder storage assets.
The tax highlights in the white paper are:
Whilst it is very early days, there are already mixed reviews as to whether the white paper will serve its intended role as a comprehensive and strategic blueprint for the long term prosperity of Australia’s agriculture sector, or whether it is just a collection of “motherhood statements” and Government propaganda.
Nevertheless, there are certainly some welcome reforms announced in the package, and we encourage you to speak to your local Crowe Horwath advisor to understand more about how they might affect you. Many of our advisors are from farming backgrounds and understand the issues that impact on you.