NFF Warns Govt: Don't Allow MIS to Distort Agriculture
11 September 2006
The National Farmers’ Federation (NFF) has today reiterated its position on Managed Investment Schemes (MIS).
NFF fully backs genuine investment in agriculture and, indeed, in the forestry sector. However, this needs to be investment driven by market forces, not upfront tax deductibility.
NFF believes MIS in its current form means the focus by investors is predominantly on upfront tax deductibility. This can lead to significant distortions and must be addressed.
As an instrument MIS it is too blunt and can create significant distortion in the farming sector.
“NFF recognises governments can, and should, support new and emerging industries by providing a ‘kick start’ where there is inherent market risk or market failure,” NFF CEO Ben Fargher said. “However, such assistance must be through direct and transparent mechanisms that provide targeted assistance.
“MIS is neither direct, transparent or targeted.
“Not only does MIS fail to meet these criteria, it is made more inappropriate for assistance given that a significant proportion of the initial investment is channelled to promoters, financial advisers, and other peripheral agencies – not to delivering returns on investment.
“The impact on MIS goes far beyond forestry. In fact, half of all MIS is tied up in non-forestry projects, clearly outstretching the original intent behind the schemes. Hence, farmers question the validity of such schemes.
“The Government must recognise the significant distortions being created through MIS. Promoting investment in agriculture or forestry is an admirable and necessary goal, but it must be delivered in a way that ensures long-term sustainability and profitability.”
Media Enquiries: Brett Heffernan, NFF Public Affairs, (02) 6273 3855 or 0408 448 250 email: