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Drought declarations and commonwealth assistance



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Media Release

The Minister for Primary Industries and Energy, John Anderson, has moved to clarify the issue of whether State drought declaration systems affect eligibility for drought-related tax concessions.

Farmers who suffer loss or destruction of pastures by fire, flood or drought are able to spread their income for tax purposes over five years, or offset it against the cost of replacement stock over five years. The proceeds from a double wool clip resulting from an early shearing because of fire, flood or drought, may be deferred to the following year.

The Minister said eligibility for these tax measures is not affected by formal declarations of drought.

"Eligibility is therefore not affected by the NSW Government's decision to abolish monthly drought declarations."

According to the Australian Taxation Office, the issue of whether a farm is in drought is a question of fact. A range of indicators of drought include pasture condition and local rainfall patterns. Farmers' tax consultants are aware of the eligibility rules.

The Minister also said that State declarations are not one of the criteria used to trigger Commonwealth Exceptional Circumstances assistance.

"Farmers in NSW should not be concerned that they will miss out on Commonwealth assistance as a result of the actions of the NSW Government."

Media inquiries:

Minister for Primary Industries and Energy

DROUGHT DECLARATIONS AND COMMONWEALTH ASSISTANCE

DPIE98/53A 28 April, 1998

Minister's office: Robert Haynes (02) 62777520/(0419) 493511 DPIE, Rural Division Noel Beynon (02) 62724669

Parliament House. Canberra ACT 2600 Tel: (06) 277 7520 Fax: (06) 273 4120