.jpg)
A tax exemption on multi-peril crop insurance (MPCI) premiums in South Australia seems set to continue past the March state election after three political parties agreed to back the move.
The governing Australian Labor Party, the Liberal Party in Opposition, and the SA-BEST party have all pledged support to the measure, which came into effect on January 01 under the SA government’s mid-year budget review (MYBR).
The exemption will cut revenue by $138,000 for the current financial year, and by around $275,000 annually for the next three financial years, reported Grain Central.
MPCI covers a wide range of agricultural risks such as fire, hail, drought, and frost, and, according to the MYBR, the four-year tax exemption will benefit around 100 policyholders annually.
“This type of insurance covers the production costs incurred by farmers if their crop fails due to a nominated peril, providing financial security and helping farms and regional communities remain financially viable,” said Steven Marshall of the SA Liberal Party.
Marshall added that farmers in SA had the highest stamp duty rate on insurance premiums nationwide, currently at 11%. This exceeds those of Victoria (10%), Queensland (9%), and NSW (2.5%).
However, the SA-BEST party added that more measures must be enacted to assist farmers in the region.
The party voiced support for an incentive scheme based on the proposed model for NSW, which will provide a rebate (capped at 50%) on MPCI premiums to all eligible farmers for the first two years, followed by another rebate with a 25% cap for the next three years.
“SA-BEST supports the Liberal and Labor position to remove stamp duty on multi-peril crop insurance, but the reality is we must go much further if we are serious about helping farmers improve their resilience and viability,” said SA-BEST’s Sam Davies.
