The Government today introduced legislation to enhance the tax treatment of the Sustainable Rural Water Use and Infrastructure Program (SRWUIP).
SRWUIP is a key program under the Government's 'Water for the Future' initiative. Projects funded through SRWUIP are improving efficiency and productivity of rural water use and management, delivering water returns to the environment and helping secure a long-term sustainable future for irrigated agriculture and local communities.
The amendments introduced today, contained in the Tax and Superannuation Laws Amendment (2013 Measures No. 1) Bill 2013, address potential adverse timing differences between when grants are taxed and when deductions are available for items of expenditure under SRWUIP.
The amendments take into account comments received on the draft legislation and explanatory material for the taxation of SRWUIP arrangements, which were consulted on in the second half of 2012.
Taxpayers will have a choice as to whether they continue to apply the existing tax law or whether they adopt the approach that had been set out in the exposure draft to their particular SRWUIP project. This choice will be available in relation to payments made from 1 April 2010.
A further four SRWUIP programs have also been incorporated into the initial list of programs for which the special tax treatment will be available, along with a further two programs announced in the 2012-13 Budget. The revised list is attached, and will be formalised once the legislation has received Royal Assent. Further SRWUIP programs will be added from time to time as they are approved and announced.
The government has committed $5.8 billion in funding for rural water infrastructure and efficient water management under this program. Of this, $5.2 billion is currently committed in the MDB.
Water savings achieved through this program will contribute substantially towards 'bridging the gap' to the new Sustainable Diversion Limits under the MDB Plan and also return water savings to irrigators and regional communities.
Attachment A
SRWUIP Programs to be Included in the Initial Published List of Eligible Programs
The following SRWUIP Programs will be listed for the period commencing on the latter of 1 April 2010 or the Start Date listed below.
SRWUIP payment recipients should consult their project documentation to determine whether their payment was received as a participant in a project under one of the following SRWUIP programs.
| Programs under the Sustainable Rural Water Use and Infrastructure Program |
Start Date (Date Program Approved by Minister) |
Description of Program |
|---|---|---|
Queensland Healthy Headwaters Water Use Efficiency Program |
18 March 2010 |
A State Priority Project under the Agreement for Murray-Darling Basin Reform of July 2008. The On-farm Program aims to help farmers in the Murray-Darling Basin invest in efficient irrigation systems and technologies that reduce water loss, deliver long-term economic benefits, and return a share of water savings to the Basin's rivers, wetlands and floodplains. |
New South Wales Irrigation Farm Modernisation Program — Pilot Program |
30 September 2009 |
An early works pilot Program as part of the NSW Irrigated Farm Modernisation State Priority Program. The Border Rivers Gwydir Pilot Program provides Border Rivers and Gwydir Valley irrigators with the opportunity to upgrade irrigation infrastructure, improve productivity, adapt to reduced water availability and ensure the long-term sustainability of local communities. Program is now complete. |
New South Wales Private Irrigation Infrastructure Operators Program |
Round 1: 9 April 2010 |
A Commonwealth-led State Priority Project under the Agreement for Murray-Darling Basin Reform of July 2008. This Program is aimed at improving scheme efficiencies including channel configuration, channel upgrades, on-farm upgrades and rationalisation for NSW Irrigation Infrastructure Operators. |
Private Irrigation Infrastructure Program for South Australia |
Round 1: 5 October 2010 |
A Commonwealth-led Program under the Agreement for Murray-Darling Basin Reform of July 2008. The program is open to irrigators in South Australia and aims to acquire water entitlements generated from the implementation of eligible Projects to improve the efficiency and productivity of water use both off and on-farm. |
Commonwealth On Farm Irrigation Efficiency Program |
Round 1: 15 March 2010 |
A Commonwealth-led on-farm program targeted at improving the efficiency and productivity of on-farm water use and management in the Lachlan and southern-connected Murray Darling Basin, and to assist communities to adjust to a future with less water. |
On-Farm Pilot Programs — Border Rivers-Gwydir CMA |
5 February 2009 |
A sub Program of the Irrigation Efficiency Program to test delivery models for acquiring water savings from future on-farm works programs. The experience and information gained from the pilot Programs helped inform the On Farm Irrigation Efficiency Program. Program is now complete. |
On Farm Pilot Programs — Lachlan CMA |
5 February 2009 |
A sub Program of the Irrigation Efficiency Program to test delivery models for acquiring water savings from future on-farm works programs. The experience and information gained from the pilot Programs helped inform the On Farm Irrigation Efficiency Program. Program is now complete. |
On Farm Pilot Programs — Murray Irrigation Limited |
5 February 2009 |
A sub Program of the Irrigation Efficiency Program to test delivery models for acquiring water savings from future on-farm works programs. The experience and information gained from the pilot Programs helped inform the On Farm Irrigation Efficiency Program. Program is now complete. |
Gascoyne Pipeline |
28 June 2010 |
Funding for construction of a high-pressure irrigation water delivery system throughout the Carnarvon Irrigation Area in Western Australia, to produce a more efficient irrigation distribution system. Best practice metering and telemetry controls will also be installed, together with implementation of an online water accounting, consumption and reporting system. |
Infrastructure removal activities under Irrigator Led Group Proposal Programs |
4 February 2011 |
Groups of irrigators are able to submit proposals to sell their irrigation water entitlements and decommission their off- farm irrigation delivery infrastructure. These proposals are to be submitted with the support of their irrigation water provider. |
Northern Victoria Irrigation Renewal Program — Stage 2 |
1 November 2010 |
A State Priority Program under the Agreement for Murray-Darling Basin Reform of July 2008. The Program addresses water efficiency in both the delivery system and user connections in the Goulburn-Murray Irrigation District. Only a portion of the funding is expected to go to private irrigators. |
Attachment B
Additional programs for inclusion in the Initial Published List of Eligible ProgramsPrograms under the Sustainable Rural Water Use and Infrastructure Program |
Start Date (Date Program Approved by Minister) |
Description of Program |
|---|---|---|
New South Wales Private Irrigation Infrastructure Operators Program — Round 2 |
7 December 2011 |
A Commonwealth-led State Priority Project under the Agreement for Murray-Darling Basin Reform of July 2008. This Program is aimed at improving scheme efficiencies including channel configuration, channel upgrades, on-farm upgrades and rationalisation for NSW Irrigation Infrastructure Operators. |
Commonwealth On Farm Irrigation Efficiency Program — Round 3 |
29 November 2012 |
A Commonwealth-led on-farm program targeted at improving the efficiency and productivity of on-farm water use and management in the southern-connected Murray Darling Basin, and to assist communities to adjust to a future with less water. |
Commonwealth On Farm Irrigation Efficiency Program — Round 4 |
Round 4 not yet open for applications |
A Commonwealth-led on-farm program targeted at improving the efficiency and productivity of on-farm water use and management in the southern-connected Murray Darling Basin, and to assist communities to adjust to a future with less water. |
Northern Victoria Irrigation Renewal Program — On Farm |
17 October 2011 |
Part of the NVIRP2 package which is a State Priority Project under the Agreement for Murray-Darling Basin Reform of July 2008. The NVIRP2 on-farm initiative is a three year project which will deliver farm irrigation system upgrades to the Goulburn Murray Irrigation District. |
New South Wales — Sustaining the Basin Irrigated Farm Modernisation Program |
16 November 2011 |
A State Priority Project under the Agreement for Murray-Darling Basin Reform of July 2008. This NSW government led on farm program aims to increase the water use efficiency of irrigated agriculture in regulated catchments in the NSW Murray-Darling Basin. |
(Infrastructure removal and reconfiguration component) Strategic Subsystem Reconfiguration |
Not commenced, announced May 2012 Budget |
Funding of up to $40 million has been committed for this four year initiative which aims to achieve water savings through the reconfiguration of inefficient off-farm delivery infrastructure with associated water purchases from decommissioned channels. |