Taxation Issues

Primary producers make an important contribution to Australia’s economic output, employment and export markets. A range of government support is available to the industry, including taxation concessions available to primary producers to assist them to better deal with fluctuating income.
Primary producers are eligible for a number of tax concessions that can be broadly classified as tax offsets, tax deductions and concessional treatments.

Tax offsets

Primary producers can use these mechanisms to reduce their assessable income, and therefore pay less tax. These include:

• tax averaging (see the Australian Taxation Office)
• non–commercial losses
• zone tax offsets
• Research and Development tax incentive

Tax deductions

These relate to expenses that directly facilitate earning income and reduces assessable income. These include:

• Farm Management Deposits Scheme
• depreciating assets
• water facilities deductions
• horticultural plants
• carbon sink forests
• electricity connections and telephone lines for small businesses
• small business entity tax concessions
• forestry managed investment scheme

Tax concessions

These relate to a variety of assistance measures for individuals such as deferrals of tax liability that can help to reduce an individual’s assessable income in the current financial year. These include;

• drought tax relief
• fuel tax credits
• insurance recoveries
• profits from the forced disposal or death of livestock
• double wool clips
• luxury car tax
• reduction in fringe benefits tax

For further information on these measures contact the Australian Taxation Office on 13 28 66.

PricewaterhouseCoopers’ report on taxation measures

In 2011–12, the Department of Agriculture, Fisheries and Forestry (DAFF) engaged PricewaterhouseCoopers (PwC) to analyse the publicly available taxation statistics as they related to the primary production sector at that time.

The report compiled by PwC draws on the 2010 Tax Expenditure Statement (2008–09 data) and does not represent the current suite of measures or the latest data available. The report does not necessarily reflect the views of DAFF.

• Supporting primary producers under the Australian taxation system – 2012  PDF [3.1 MB]
• Supporting primary producers under the Australian taxation system – 2012  Word [3.2 MB]