HALF a million small businesses and farmers are set to win from a Gillard government commitment to simplify the antiquated trust tax laws, which aims to end years of legal uncertainty for trust users and their advisers.
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As part of the long-awaited review, which experts hailed as "courageous" due to its politically sensitive history, the government will make immediate amendments so 23,000 farmers who have trusts can continue to benefit from established concessions.
They include income averaging, which takes into account the volatility in farm income, and tax breaks for farm management bank deposits, The Australian Financial Review reports.
Trust tax benefits for farmers were outlawed in March this year by the landmark Bamford High Court decision, which prevented beneficiaries of primary production trusts from being classified as primary producers, if the trusts posted a loss.
National Farmers Federation president Jock Laurie welcomed the government's decision and noted the issue had been a "major concern", especially because drought and floods meant many farmers had recorded financial losses.
