The FINANCIAL -- Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig, and Assistant Treasurer, Senator Mark Arbib, have welcomed the passing of legislative changes to the Farm Management Deposits Scheme that will provide additional assistance to Australian primary producers affected by natural disasters, including those hit by the devastating 2011 summer floods and Cyclone Yasi.

Through the FMD Scheme, individual primary producers are encouraged to set aside pre-tax income in good years for use in low-income years. FMDs provide primary producers with tax benefits if kept for at least 12 months, as tax is not payable on the income until the financial year it is withdrawn, when primary producers may benefit from a lower marginal tax rate.

Minister Ludwig said the changes to the FMD Scheme will mean that eligible primary producers can access their FMDs early when they have been affected by a natural disaster, without losing their taxation benefit, to help with the rebuilding of their business.Other changes to the FMD Scheme will allow primary producers to hold FMDs simultaneously with more than one provider, allowing primary producers to receive the most competitive return on their FMDs.

Assistant Treasurer Mark Arbib said ordinarily, financial institutions forward unclaimed moneys to the Commonwealth when a deposit has been left untouched for seven years.

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