The National Farmers' Federation is again urging Senate cross-benchers to consider the impact of proposed taxation changes for superannuation on thousands of family farms across Australia. "We are pleased to see reports today that Senate crossbenchers David Pocock and Jacqui Lambie have raised concerns about the proposed legislation, and we are calling on others to do the same," NFF Acting CEO Charlie Thomas said.
The NFF is calling on Parliament to make critical amendments to the Federal Government's proposed tax changes on superannuation, emphasizing the detrimental impact these changes will have on thousands of family farms across the country.
The Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill 2023 is currently before the Lower House, and the NFF is urging legislators to exempt primary production assets from the legislation.
Mr Thomas highlighted the unique financial structure of many family farms, where older farmers often hold their farm in a self-managed super fund (SMSF) and lease it to their children, providing retirement income while giving the next generation an opportunity to start farming. "We are extremely worried that the proposed increases in taxation rates, including the treatment of 'unrealized gains' on holdings, will increase the tax obligation so much that farmers may be forced to sell land assets to pay the tax bill. This may leave farmers with a terrible choice: sell the farm to meet these new tax and liquidity obligations, or increase their lease rates so much that their own children and grandchildren can't afford it and leave the industry."
This will impact thousands of farmers right across the country, from Tasmania to Northern Australia.
"The Government has consistently said this bill is aimed at the top end of town, making countless references to people with hundreds of millions of dollars in their super accounts as the target of the reforms – not hard-working family farms.
"If that truly is the case, the Government should have no issue supporting amendments that ensure this legislation does not impact farming families," Mr Thomas said.
The NFF's concerns have been echoed in the recent Senate inquiry with evidence from the SMSF Association estimating over 17,000 accounts in 2021/22 held farming land and of these, more than 3,500 would be impacted by the new tax. It's expected this figure could grow substantially higher in coming years if the Government continues not to apply indexation to the base threshold.
Source: nff.org.au