Kerry O'Brien (Tasmania, Australian Labor Party, Shadow Minister for Primary Industries, Fisheries and Forestry) Share this | Link to this | Hansard source

My question is to Senator Abetz, the Minister representing the Minister for Agriculture, Fisheries and Forestry. I refer the minister to changes announced by the Assistant Treasurer to the tax arrangements for non-forestry managed investment schemes. Is the minister aware that this announcement has created significant uncertainty for this growing sector of Australia’s agricultural industry? Isn’t this uncertainty placing at risk up to half a billion dollars in investments and thousands of jobs in rural and regional Australia? Can the minister indicate what steps he took to try to save these jobs and industries or whether he simply accepted the Assistant Treasurer’s devastating decision that will destroy jobs and industry in rural and regional Australia?

Eric Abetz (Tasmania, Liberal Party, Minister for Fisheries, Forestry and Conservation) Share this | Link to this | Hansard source

In relation to the matter that the honourable senator has raised, I can confirm that the Minister for Revenue and Assistant Treasurer, the Hon. Peter Dutton, announced on 6 February that the Australian Taxation Office has reviewed its interpretation of taxation law and will issue a draft taxation ruling, effective from 1 July 2007, setting out its reconsidered view in relation to managed investment schemes. The effect of this change in interpretation of the current law is that investors in managed investment schemes will no longer be able to claim up-front deductions for their contributions to the scheme on the basis that the investor is carrying on a business. It was also announced that the government has decided it is not disposed to introduce taxation arrangements for investment in non-forestry agribusiness.

I was asked what representations the minister made in relation to this. As the honourable senator knows, I represent the minister for agriculture in this chamber. If he had asked me about forestry MISs, for which I am personally responsible, I could have indicated the answer to him. In relation to the agriculture side, I will take that on notice.

Kerry O'Brien (Tasmania, Australian Labor Party, Shadow Minister for Primary Industries, Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I thank the minister for taking that on notice. It is regrettable that he has not been fully briefed to answer questions in question time on this important issue. Is the minister aware of comments by Mr Rob McGavin, of a company called Boundary Bend, that the government ‘has no idea of the impact this decision has on our business and has not consulted’? Robert Hance, CEO of Timbercorp said, ‘In not establishing a formal process of consultation and review, how can the government have any sense of the economic and social impact of their action on rural Australia?’ Can the minister explain why the government have not undertaken consultation with the industries and communities affected before making such a damaging announcement?

Eric Abetz (Tasmania, Liberal Party, Minister for Fisheries, Forestry and Conservation) Share this | Link to this | Hansard source

I am aware of the comments. I would assume that the minister for agriculture would similarly be aware of those comments. In relation to the extent of the consultation that took place, I am not fully privy to that and I will take that aspect on notice. I understand that consultation did take place but, as to the extent of it, I am unable to assist the honourable senator.