Tony and his wife Carmen Galea migrated to Australia from

Tony and his wife Carmen Galea migrated to Australia from Malta in 1965. As Tony had extensive experience in farming the couple quickly acquired a large land holding in Western Sydney in a town called Blacktown for $18,000. Tony had come from a family who strongly encouraged investment in land. Tony and his family believed that due to the finite supply of land that it would be a good investment and would probably be worth a lot of money in the future. The couple used the land to farm a number of vegetables including zucchini, pumpkin and turnips. Tony would transport the vegetables to the market where he sold the produce to the various stalls who would then on sell the goods to the public. In 1987 Tony decided to start farming pigs and sought council approval for the erection of a piggery on their property in Blacktown. The piggery was approved and with the help of his wife and children Tony successfully managed both his market garden and piggery. To the couples dismay the property and surrounding areas had been re-zoned for residential development in 1990. Tony and Carmen enjoyed the rural life and continued to farm the land. By 1998 the farm was surrounded by high density residential housing and council was consistently investigating complaints about the stench which came from the piggery. Due to complaints Tony and Carmen were forced to close their business in 2000. After spending $200,000 for removal of the piggery and remediation of the land around it, in 2004, the couple reluctantly sold the property to a land developer for $5,000,000.

Required: 

What are the income tax consequences of the sale of Tony and Carmen Galea’s land? Discuss.