Agribusiness managed investment schemes taxation transition announced

The Tax Commissioner Michael D’Ascenzo has announced a transitional period for the Tax Office’s reconsidered view of the tax treatment of agribusiness managed investment schemes.

The reconsidered view will apply to arrangements entered into from 1 July 2008 instead of 1 July 2007 as earlier announced.

The Commissioner also confirmed the draft tax ruling outlining the reconsidered view will issue mid April and will be subject to the usual six week consultation process.

On 21 December 2006 the Forestry and Conservation Minister, Senator Eric Abetz, and Minister for Revenue and Assistant Treasurer, Peter Dutton, announced new arrangements for the taxation of investments in forestry managed investment schemes (MIS). They also announced that the Government would consider the issue of taxation arrangements for non-forestry agribusiness MIS in the new year.

The Government decided that, with effect from 1 July 2007, investors in forestry MIS will be entitled to immediate upfront deductibility for all expenditure provided that at least 70 per cent of the expenditure is expenditure directly related to developing forestry (‘direct forestry expenditure’).

On 6 February 2007 the Government announced it is not disposed to introduce a similar taxation arrangement for investments in non-forestry agribusiness MIS.

UPDATE: see new article on draft ruling