18 August 2011

1 minute read

Oceania

"Last October, the Minister of Revenue announced that the tax treatment of livestock will be reviewed and Federated Farmers has discussed this in detail with Inland Revenue," says Bruce Wills, Federated Farmers President and its economics and commerce spokesperson.

"This review was confirmed in May's Budget and forms part of a wider ranging review into how high-value assets are treated for tax purposes."

"Federated Farmers will now examine Inland Revenue's proposals for reasonableness and real-world workability. Let me also stress that farmers do understand the importance of paying their fair share of tax."

"With livestock, there's been some concern at the ease farmers have switched between the Herd Scheme and the National Standard Cost scheme. This is especially the case when livestock values are extremely volatile."

"Broadly speaking, the Herd Scheme treats livestock as a capital asset using Inland Revenue's national average market values. The National Standard Cost scheme values purchased livestock at cost plus associated costs of husbandry."

"Farmers, as small and medium sized businesspeople, are heavily reliant on their accountant for tax advice. It's a complicated area and you do rely on your advisors to interpret it for you."

"Federated Farmers will now start consultation with our membership to develop a position to take back to Inland Revenue," Mr Wills concluded.

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