The multibillion-dollar agribusiness investment industry has taken the Australian Taxation Office to court. A test case is underway which could determine whether thousands of investors in non-forestry schemes will be allowed to claim tax deductions.
The industry seems to be quietly confident that its argument may prevail. Agriculture Investment Managers Australia argues that its investor members – which include Timbercorp and Great Southern Ltd – are like farmers in that they carry the financial risks caused by the changing price of their crops.
The two-day hearing, which ended last week, will result in a Federal Court decision later this year. Agriculture Investment Managers Australia challenged the Australian Taxation Office over its draft ruling in April, withdrawing tax deductions from non-forestry managed investment schemes.
Michael Clark, a spokesman for ITC (Integrated Tree Cropping), a division of Futuris Corp, said that between 65 and 70 per cent of the funds raised went into forestry.