Contrary to the totally inaccurate headline in last week’s Australian Financial Review story, investors in forestry managed investment schemes are not in danger of losing the tax deductibility of their investments.
“The headline completely confused forestry and non-forestry MIS investments, a mistake that was repeated in two places within the story itself,” said Alan Cummine, Chief Executive of industry representative body, Treefarm Investment Managers Association.
“TIMA hopes that the Financial Review will be gracious enough to publish a prominent correction,” he said.
“The reversals of forestry and non-forestry MIS in the headline and in the article utterly misrepresent the truth. It is actually the non-forestry schemes, rather than the forestry schemes, that are under a cloud.
“The demonstrable fact is that from 1 July 2008, forestry MISs will be operating under a specific deduction legislated in June 2007. This legislation resulted from a policy decision of the previous Government, supported by the then Opposition, to safeguard MIS plantation forestry from the Tax Commissioner’s new view of the law. This view is to be tested in the Federal Court later this year.
“That means that investors will continue in the future to be able to claim a deduction for their contributions to forestry MIS projects, confirmed by ATO product rulings, just as they can this year and just as they have been able to for many years,” Cummine said.
“Furthermore, non-forestry schemes on offer in 2007-08 are also still available with full tax deductibility for investors, confirmed by ATO product rulings. The question mark over future non-forestry projects is that these companies will not be able to offer similar projects from 2008-09 onwards unless and until the ATO test case is decided in the industry’s favour.”
Cummine said that it was most unfortunate and annoying that an otherwise fairly accurate report had been so badly tarnished and negated by a totally wrong headline and two fundamental corresponding errors in the report.
