Drought affected farmers will receive further assistance from the Federal Government with the introduction of legislation today to make access to Farm Management Deposits (FMDs) easier.
Federal Agriculture Minister Warren Truss and the Minister for Revenue and Assistant Treasurer, Senator the Hon Helen Coonan today announced the introduction of amendments to tax legislation that governs the Farm Management Deposits scheme to allow farmers in Exceptional Circumstances (EC) areas to access any FMDs that are less than 12 months old and keep the tax benefits.
"The partial withdrawal of FMD monies will also be permitted without affecting the benefits that accrue to the remaining money," Mr Truss said.
"The Government believes farmers in EC areas and recognised buffer zones who are new to the scheme should not lose access to the very benefits that attracted them to the scheme in the first place.
"With more and more farmers using FMDs to put money away in good times in preparation for bad, it makes sense to assist them now with large parts of the country in the grip of severe drought. Many farmers and other primary producers who have taken advantage of the scheme since its inception in 1999 are now reaping the benefits."
Another amendment will mean that any FMD product priced for less than twelve months will still be considered an FMD providing it is rolled over continuously for a 12 month period.
"The issue of the term of individual deposits was identified in the recent FMD Review and has been of concern to farmers so I am pleased to be able to respond," Senator Coonan said.
"The management of FMDs demonstrates that primary producers are maximising flexibility by choosing an FMD product that best suits their individual cash flow and management needs. This decision also resolves the current uncertainty as to the term of a deposit.
"The FMD scheme has been extremely successful and provided real benefits to farmers. It is estimated that farmers will have received a tax benefit of around $470 million through the scheme in 2002/03," Senator Coonan said.
Media contacts:
Mr Truss's office - Tim Langmead (02) 6277 7520 or 0418 221 433
Senator Coonan's office - Shaun Anthony (02) 6277 7360 or 0438 690 305