Cattle transaction levy review on the cards

A change in the amount of the levy paid has to be instigated by the industry itself via a review process and would involve extensive consultation nationwide with producers.

Given the improved cattle market, and the threats of animal disease incursions on Australia's doorstep, there have been suggestions a levy increase was currently called for.

Over the years, suggestions have also been made that the levy amount needed to reflect the sale price of stock better. If it were a percentage of the sale figure, rather than a flat rate, less would be paid in drought and more in times of record prices such as what has been seen over the past two years.

Economists have also estimated that had the levy risen in line with the consumer price index, it would currently be around $7.20.

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The levy on both grainfed and grassfed cattle is $5 per head. It is collected by the Department of Agriculture, Fisheries and Forestry's levies service and distributed to Meat & Livestock Australia, Animal Health Australia and the National Residue Survey.

The larger proportion of both go to MLA but for the grassfed sector, the breakdown sees more money spent on marketing.

Sheep, goats and bobby calves also attract a smaller transaction levy which are sent to the same organisations.

Since it was introduced in 1990, there have been only two reviews of the cattle transaction levy. In 2006, the then Federal Government accepted recommendations from industry to increase it from $3.50 to $5, with the additional amount directed into marketing beef.

A 2009 review resulted in cattle producers voting to maintain the levy at the rate of $5 per head, with more than 70pc voting for the status quo.

The new Federal Government is looking to streamline and modernise its legislation around agricultural levies and charges.

There are currently more than 110 levies collected on more than 75 commodities across the agriculture, fisheries and forestry sectors.

DAFF is running a levy modernisation review which includes extensive consultation with industry groups. It says reducing complexity and inconsistencies in the current legislation is the key aim.

The timeline is for new legislation to be in place by April next year.

DAFF says this review is entirely separate to any moves to change individual levy settings, as they are for industry to decide.

The government's commitment to matching funding for eligible research and development is also not under consideration.

Any wishes by the cattle industry to change the levy would require the submission of a proposal to the Minister for Agriculture and there was no need to wait for the new legislation to get that process underway, according to DAFF.

Cattle Council of Australia says its board has agreed to 'start a process to review the cattle transaction levy to potentially recommend a levy quantum to the minister.'

In its latest communique wrapping up board and policy affairs, CCA said a levy review would be an involved and lengthy process and any change must be endorsed by grassfed cattle industry members. That would only occur once significant industry consultation had been undertaken, it said.

"The board considered that the industry must be clear about what it wants from the levy over the next decade and would need to balance that with enough funding to meet the requirements of the service providers," the communique said.

"The consensus is that AHA, which receives 13 cents of the $5 levy, is underfunded given the potential for animal disease incursions and the need for a substantial focus on biosecurity and disease response preparedness."