AFG Publications

Timber plantations are sometimes incorrectly perceived to be the beneficiaries of ‘incentives' or ‘subsidies' through the Australian taxation system. Consequently, the tax treatment of plantation forestry is also sometimes incorrectly targeted as the direct cause of land use change associated with plantation establishment on cleared agricultural land.
Such a view misunderstands the application of Australian tax law allowing the deduction of legitimate expenditure incurred in conducting business activity to generate future profit. Plantation establishment and management does not receive special tax incentives or subsidies. Plantation forestry operates under the same basic tax regime as other agricultural enterprises - that is, deductions are available for claimable business expenditure, and tax is paid on the profit from the enterprise.

This information sheet explains the tax treatment of plantation forestry and the managed investment scheme (MIS) structure through which most new plantation establishment is currently financed. The MIS structure has proven to be the most effective way of attracting private investment into new timber plantations to make up for the reduction in
government-funded plantation expansion and the diminishing access to natural forest for harvest. To view this publication, click on the link below.

 Timber Plantations and Managed Investment Schemes Essential Tax Basics 158.40 Kb