CBH loses tax exemptions
CBH is set to lose millions in tax exemptions after the Liberal National coalition rejected a Labor tax amendment Bill in Parliament last week.
In June, the State Government introduced a controversial Taxation Legislation Amendment Bill to close a tax loophole to exclude so-called fourth limb organisations, established for the promotion of trade and industry, from claiming an exemption for payroll and land tax.
Co-operative grain giant CBH currently qualifies under the existing legislation as a fourth limb organisation and last year accrued $38 million in tax savings as a result of the loophole.
Furthermore, it is also understood the co-operative stands to gain $10 million next year from the savings and then about $6 million each year after that, under the current legislation.
The savings equate to 50c to $1 a tonne of grain for CBH growers.
In September, a Senate Standing committee was set up to inquire into the controversial Bill, which had been drafted to amend the legislation loophole.
But _Countryman _ understands the cash-strapped State Government has already allocated the expected $48 million it will save by closing the loophole to forward estimates, before the Bill was passed in the Upper House.
In Parliament last week, WA Labor Member for the Agricultural Region Darren West was overwhelmingly defeated in a motion to enable wholly-owned grower co-operatives and other associated associations and industries to be exempted from the taxes.
In his motion, Mr West argued to Parliament that co-operatives like CBH should be entitled to the exemption because profits were distributed wholly back to the 4300 shareholder growers.
A spokesman said the CBH Group was disappointed it was likely to lose the exemption.
"We appreciate that some members were seeking to support agricultural co-operatives through these exemptions and recognise the unique benefits of co-operatives and the benefits CBH brings the grain growers and communities of WA," he said.
"CBH received an exemption from State land and payroll tax and stamp duty, on the basis of its co-operative structure, that includes promoting and fostering WA agriculture."
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