Primary producers to reap tax reform benefits

The Liberal National Government has delivered land tax reforms to provide equity for farmers and horticulturalists by clearly defining properties used for primary production.

  • Up to $3m in annual taxpayer savings

  • Land tax exemptions to apply immediately

The Liberal National Government has delivered land tax reforms to provide equity for farmers and horticulturalists by clearly defining properties used for primary production.

"It's the biggest overhaul of this tax exemption since the 1970s, so it's long overdue," Finance Minister Bill Marmion said.

"It cuts red tape, reflects our modern economy and will be a major bonus for growers in non-rural areas such as the Swan Valley."

For example, previously people growing grapes for the production and sale of wine - rather than just for the sale of fruit - did not qualify as primary producers.  Now they will be eligible for whole or partial land tax exemptions.

If processing or conversion takes place on the same property that is used for primary production, an exemption will apply to the portion of the land used to grow the produce or livestock.

The cumbersome one-third income test to classify taxpayers as primary producers has also been completely overhauled.

"From now on we will have a simplified, more flexible business test that does not rigidly require a landowner to derive at least one-third of their income from primary production," Mr Marmion said.

"It's another example of how the Liberal National Government is backing Western Australian business and employment, by recognising the wide variety of modern land use and commercial production."

The new laws, passed on the first day of the 2015 State Parliament, will extend up to $3 million annually in exemptions to qualified taxpayers.  They will generally apply from July 1, 2014, allowing updated exemptions on land tax assessments for 2014-15, with changes relating to secondary production applying from July 1, 2012.

       Fact File

  • In 2013-14, about $70.2m in primary production exemptions were granted to more than 30,000 people, including about 1,700 in the non-rural zone and 28,300 in the rural zone

  • Secondary production reforms extend potential land tax exemptions on non-rural properties where production is not carried out by the landowner but by family members or related entities

  • Appeals processes have been streamlined

  • For more information, visit http://www.finance.wa.gov.au

Minister's office - 6552 6800