The Federal Court of Australia has ruled in favour of Australia's agribusiness sector's appeal against the Australian Taxation Office (ATO) in regards to an industry test case on non forestry managed investment schemes (MIS).
The full bench of the Australian Federal Court handed down their unanimous decision earlier today.
Agribusiness firms, Great Southern and Timbercorp both responded positively to the court's decision.
"The ATO's decision to reinterpret the laws caused a great level of uncertainty for the industry and indeed Great Southern," Great Southern chief executive Cameron Rhodes said.
"We were always confident that the industry's position was strong and supported by considerable precedent and our position has clearly been vindicated by the court."
In a statement to the Australian Securities Exchange, Timbercorp said: "Timbercorp welcomes the decision as it confirms the company's own view and is consistent with what has been commonly practiced over many decades."
The decision comes almost two years after the ATO announced that it would re-interpret the law meaning investors would no longer be able to claim upfront deductions on non-forestry MIS on the basis that investors are carrying on a business.
The ATO has a period of 28 days to lodge any appeal against the decision to the High Court.
