The Abbott government has delivered on a 2013 election promise to put foreign investment in agricultural land under greater scrutiny.
And it’s promised to soon make changes relating to residential real estate. The Foreign Investment Review Board threshold for screening agricultural land purchases will be dropped from $252 million to $15 million from March 1.
The new threshold will apply to the cumulative value of agricultural land owned by the foreign investor, including the purposed purchase. Speaking at a sheep farm near Canberra on Wednesday, Prime Minister Tony Abbott said the government would also set up a foreign ownership register of agricultural land.
From July 1, the Australian Taxation Office will start collecting information on all new foreign investment in agricultural land, regardless of value. Mr Abbott said new free trade deals with Japan, Korea and China made Australia a vastly more attractive investment destination now than 18 months ago.
But it was important that foreign investment was transparent and in the national interest, he said.
“This is going to help to reassure the Australian public that the foreign investment we need is right for us,” Mr Abbott said.
National Farmers Federation president Brent Finlay said the move would ensure a fact-based discussion around who owns what.
“We know that 99 per cent of Australian farms are owned by Australian families,” he said.
“We need to see who’s buying what so that we can have an informed discussion.”
Farmers are seeking talks with the government on whether water rights, water licences and food processors will be covered by the new register. The register was expected to be operating by Christmas last year but further work was ordered by Treasury.
More changes to FIRB rules are expected within weeks, aimed at foreign investment in residential real estate.
Treasurer Joe Hockey said there needed to be better enforcement of the rules for foreign purchases of existing homes so young people were not priced out of the market.
“It is clearly an issue in our metropolitan areas that there is seemingly an increase in unlawful acquisitions of existing residential real estate by foreign persons,” he said.
An inquiry into foreign purchase of real estate called for higher administration fees for foreign buyers and a register of all Australian real estate in foreign hands.