Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


New livestock tax rules in Budget 2012

24 May 2012

New livestock tax rules in Budget 2012

Federated Farmers believes tighter tax rules around livestock valuations have been well-signalled.

“Most farmers are reliant on accountants for their business tax needs and I’m no exception,” says Bruce Wills, Federated Farmers President and its economics and commerce spokesperson.

“This is no different to a range of professions, such as freelance journalists or even actors. We all recognise the need to meet our tax obligations without overpaying. I don’t think there‘d be too many wage and salary earners who’d disagree.

“Back in March, the Government announced the herd scheme election would be irrevocable from August 2011. 2011 is not a misprint as it is being applied retrospectively.

“This is unusual but we were also aware a spike in livestock values had encouraged some farmers, on advice from their accountants, to elect out of the herd scheme. Arguably this may have come as a result of impending legislative changes clearly signalled last August.

“The Government made it clear it wasn’t prepared to wear on-going fiscal risk and we understand why. These changes will protect $184 million over four years.

“We need to reassure farmers it won’t impact either past tax paid or tax to be paid in the 2011-12 financial year. On that basis we accept this change.

“More generally however, we continue to prefer for a 24-month notice period instead of making the election irrevocable.

“We do appreciate Government listening to Federated Farmers when people change their farming operation to a fattening regime. Elections here will continue to have a cost-based scheme option.

“We are still trying to convince Inland Revenue to allow elections when sharemilkers move into farm ownership.

“We want sharemilkers to have the option of electing out of the herd scheme when they down-size herds ahead of buying their first farm. Given debate about the problems young farmers have getting onto the farm ownership ladder, this seems counter productive.

“Purchasers in ‘associated party transactions’ will be required to adopt the vendor’s herd scheme election and base herd numbers. This exception was requested by Federated Farmers submission when there is a complete inter-generational change of ownership

“Unlike herd elections, associated party transactions took effect from 28 March 2012.

“While the Government has announced these changes as ‘made’, they in fact require amendments to the Income Tax Act. Federated Farmers will be engaging in this process,” Mr Wills concluded.

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Gordon Campbell: On Tiwai Point (And Saying “No” In Greece)

Its hard to see how Rio Tinto’s one month delay in announcing its intentions about the Tiwai Point aluminium smelter is a good sign for (a) the jobs of the workers affected or (b) for the New Zealand taxpayer. More>>

ALSO:

Half Empty: Dairy Product Prices Extend Slide To Six-Year Low

Dairy product prices continued their slide, paced by whole milk power, in the latest GlobalDairyTrade auction, weakening to the lowest level in six years. More>>

ALSO:

Copper Broadband: Regulator Set To Keep Chorus Pricing Largely Unchanged

The Commerce Commission looks likely to settle on a price close to its original decision on what telecommunications network operator Chorus can charge its customers, though it probably won’t backdate any update. More>>

ALSO:

Lower Levy For Safer Cars: ACC Backtracks On Safety Assessments

Dog and Lemon: “The ACC has based the entire levy system on a set of badly flawed data from Monash University. This Monash data is riddled with errors and false assumptions; that’s the real reason for the multiple mistakes in setting ACC levies.” More>>

ALSO:

Fast Track: TPP Negotiations Set To Accelerate, Groser Says

Negotiations for the Trans-Pacific Partnership will accelerate in July, with New Zealand officials working to stitch up a deal by the month's end, according to Trade Minister Tim Groser. More>>

ALSO:

Floods: Initial Assessment Of Economic Impact

Authorities around the region have compiled an initial impact assessment for the Ministry of Civil Defence, putting the estimated cost of flood recovery at around $120 million... this early estimate includes social, built, and economic costs to business, but doesn’t include costs to the rural sector. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news