THIS year’s federal budget delivered some big headline numbers like $8.4 billion for the inland rail and cash to create the $4b Regional Investment Corporation to help expedite the delivery of federal financial assistance to farmers in need.
Post-budget, Nationals leader Barnaby Joyce has shouted out about the inland rail’s macro capacity to cut transport costs and move product to market faster for farmers while Treasurer Scott Morrison has talked-up the fiscal significance of infrastructure investment - including for the regions.
But in their musings, the two senior cabinet ministers have been deathly silent about the budget’s fine print and micro farm levy alterations.
The budget papers contained details of the numbers underscoring subtle changes to agricultural levies charged on farm products like bananas, avocados, seed cotton, tea tree oil, thoroughbreds and laying chickens, to fund biosecurity and R&D programs.
This year’s budget papers revealed the new changes - made at industry’s request - would see $2.1m raised per year, over the next four years out to 2012.
But the same levy items are also accounted as expense measures in the forward projections.
On April 1 this year, the government increased the Plant Health Australia (PHA) component of the banana levy from 0.0103 cents per kilogram to 0.5c per kg, and rounded up the levy’s marketing component to 1.15c per kg (from 1.1497c per km), at the request of the Australian Banana Growers’ Council, the budget papers said.
“The funds raised will be used to repay the $3m grant provided by the government to assist the banana industry with measures to manage and contain Panama disease,” the papers said.
On the same date, the government introduced a PHA levy of 0.1c per kg on fresh avocados, as proposed by Avocados Australia, to support industry biosecurity management.
There will also be a corresponding reduction of 0.1c in the existing avocado R&D levy rate from 3.0c per kg to 2.9c per kg, the budget papers said.
On April 1, a mandatory export charge of $4.06 per tonne was introduced by the government on seed cotton exports, comprising a $3.99/t R&D levy, $0.07/t PHA levy, and an Emergency Plant Pest Response (EPPR) levy presently set at zero, at the request of Cotton Australia.
“This will ensure that the levies currently collected on all cotton lint produced in Australia continue to be collected in the case that some cotton lint is exported as seed cotton,” the papers said.
Other changes announced in budget
From July 1 this year, the government will establish an R&D levy of 25c per kg of tea tree oil sold domestically or exported, at the request of the Australian Tea Tree Industry Association.
The government previously provisioned for a matching contribution of $140,000 per annum, consistent with its commitment in the Agricultural Competitiveness White Paper.
An EPPR levy will also be established at a nil rate, with a positive rate to be activated at a later date if required to respond to disease incursion.
From July 1 this year, the government will also implement its election commitment and establish an R&D levy of $10 per mare covered (paid by the stallion owner) or returned (paid by the broodmare owner) per season, as requested by Thoroughbred Breeders Australia.
The Government previously provisioned for a matching contribution of $400,000 per annum, consistent with its election commitment, the budget papers said.
From July 1, the Emergency Animal Disease Response (EADR) levy on laying chickens will be reduced from 1.4 cents per one-day-old chick to zero, as requested by the Australian Egg Corporation Limited.
“This reflects that the egg industry’s liability incurred for the eradication of the avian influenza outbreaks under the EADR Agreement has been repaid,” the papers said.