THE National Farmers’ Federation says Australian farmers are breathing a sigh of relief after a tax on superannuation did not pass the Senate.

NFF President David Jochinke said the sector had consistently raised serious concerns about the potential impact the Super Tax would have on hardworking farming families across the country.

“Thousands of farms across Australia are held in self-managed superannuation funds (SMSF) so they can be leased to the next generation, providing both retirement income and an opportunity for the next generation to take over the business,” Mr Jochinke said.

David Jochinke

Modelling, including from the University of Adelaide, has shown more than 3,500 SMSFs holding farming land would be impacted on Day 1 of this tax being implemented, and this number will only grow. Furthermore, small business owners will also be impacted with over 13,000 SMSFs holding business real property (i.e. small business assets).

“The farm sector is particularly worried that the taxation of ‘unrealised gains’ may force primary producers to sell their farm just to pay off their new tax bill,” Mr Jochinke said.

“This tax spells disaster for the hardworking Aussie families who set up these funds in good faith, to give the next generation a leg up. We know farming and small businesses are the backbone of the Australian economy.”

The NFF has been advocating on this issue for nearly two years, and has been joined by a broad coalition of small business, accounting and superannuation bodies – united in their concern particularly regarding the taxation of unrealised capital gains.

“The NFF thanks the crossbench Senators, who have taken the time to understand the impacts of the Super Tax Bill and stood up for the interests of Aussie farmers and other small business owners.

“While this development is welcome, we note that the Bill remains in the Senate. Parliament at this stage is still due to sit next February with potentially several sitting weeks before the next federal election is called.

“We encourage the Government to seize this opportunity to reshape the policy in consultation with stakeholders.”

Nationals vow to abandon policy

Nationals leader David Littleproud has been one of the most vocal opponents of the super tax. He said if elected the opposition will abandon the policy.

David Littleproud

“A future Coalition Government will ensure this bad policy never sees the light of day,” Mr Littleproud said.

“Labor has shown callous disregard for our farmers and thought it would be okay to tax them for on-paper gains during a cost-of-living crisis. Throughout the process, Labor proved they have no understanding of the vagaries of farmers’ cash loss that are impacted by not just weather but commodity prices.”

Mr Littleproud said many families had previously set up SMSFs as their future retirement and savings, unaware Labor could come for their assets.

Labor was also unable to say how many primary producers, small and family business owners would be impacted, he said.

“Labor broke an election promise but is now backing down due to fierce backlash. The Nationals will continue to fight for our farmers and their future.”

Source: David Littleproud/NFF