Labor's decision to swiftly double the cost of application fees for overseas investors when it won government this year has continued to rile and baffle agricultural investment fund managers.
New Foreign Investment Review Board application fees now range from a minimum of $4000 for land worth less than $75,000, to $1.04 million for property selling for more than $80m.
Offshore investment in Australian farmland should be seen as a vote of confidence in our agriculture sector and should be encouraged, not an excuse for extra taxes, said Australian Agricultural Company director, Anthony Abraham.
"Anything which limits foreign investment in agriculture is really just a tax on the people who run the assets now or those who are investing in agricultural assets," Mr Abraham said.
He is also a partner in the Asia-Pacific investment group, Roc Partners, whose private equity investments with overseas and local funds range from oysters to grain properties; Capilano honey; blueberry and vegetable producer, Flavorite; Stone Axe Wagyu, and chicken farm operator, ProTen.
Mr Abraham believed this year's leap in FIRB fees would erode the natural value of farming assets.
He said the FIRB fee problem was hard to sell to the wider community because farmland ownership was often romanticised and public sympathy was not naturally with overseas buyers.
Yet farming and farmland assets were no different to other businesses in the community where overseas ownership and products were more prevalent.
Also addressing the topic at the NSW Farm Writers' forum on financing the future of farming Gunn Agri Partners managing director, Brad Wheaton, warned that as an industry, the farm sector really should care about FIRB fees, even if politically this was not an issue politicians or voters cared greatly about.
He said what started out as a charge to cover the cost of monitoring the volume of foreign capital investing in Australian property, and where it was coming from, had become a big ticket item in property transactions.
"These fees are becoming prohibitive," Mr Wheaton said.
He questioned why it was acceptable to charge "way more than the value of the service provided".
He also noted less than a handful of agricultural deals involving foreign investors had ever been blocked as a result of FIRB reviews.
Meanwhile, Mr Abraham lamented government investment into genuinely beneficial services to the agriculture sector had been drying up, particularly research and extension services to promote productivity best practices.
"Government-backed extension efforts to benchmark and lift the level of practices across a district aren't there any more, or they tend to be more of a selling exercise by commercial operators," he said.
He was also uneasy about the way government-owned CSIRO technology was increasingly privatised.
Fellow panellist, Andrew Tout, from Centuria's agribusiness division believed much more government focus was required on getting agricultural production out to export markets via better infrastructure.
"While we're known as a lowest cost producer of farm commodities, we lose our export advantage getting our production to port," he said.
There was much governments could doing to incentivise extra and more efficient transport and water infrastructure.
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