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Grain Producers Australia says the findings of a new report and independent expert analysis, has cast a bigger spotlight on the fundamental flaws in the government’s proposed biosecurity tax.

A report by the Crawford School of Public Policy’s Tax and Transfer Policy Institute (TTPI) at ANU has delivered another scathing assessment of the Biosecurity Protection Levy, highlighting serious failures and contradictions in the policy’s design and key principles.

It follows on from the Productivity Commission’s direct criticisms of the proposed biosecurity tax, which also exposed fundamental design failures, in a report released late last year.

The TTPI’s analysis also critiques the policy following the government’s recently announced changes, saying it still fails proper scrutiny, despite the original 10 per cent biosecurity tax on all producers being dropped and replaced by a new GVP ratio.

GPA Chair and WA grain producer, Barry Large, said the independent analysis was further evidence of the serious policy failures and underlines again why the proposed tax must be scrapped.

“This ANU report says overall, the government’s package to implement the BPL does not pass critical scrutiny,” he said.

“It also says, given the list of weaknesses in the proposed BPL, an alternative policy approach is desirable and suggests creating an efficient market outcome, instead of taxing producers more.

“This is further independent evidence of what producers have been saying all along: that this is a fundamentally bad idea with negative consequences attributed to a fatally flawed design.”

Mr Large said the ANU report’s release was critical, with the enabling legislation due to be presented to Federal Parliament in the near future, to try to meet the July 1 implementation deadline.

“GPA urges all members of parliament – especially cross-bench Senators – to carefully consider this report’s findings and to talk with the producers actually impacted by this bad policy,” he said.

“In particular, those producers who’ve been directly impacted by Varroa with lost productivity and incomes – but are now paying tens of millions of dollars in emergency biosecurity levies, whilst being hit with a new biosecurity tax that’ll go directly into consolidated government revenue.

“Producers across all farm commodities have provided a strong and unified voice against this proposal, given we already pay enough in levies to fund multiple public good outcomes – including environmental benefits and increased taxation generation for the nation.

“This new report clearly articulates these fundamental facts, and shows why taxing producers more, for services that should be funded out of general taxation revenue, is a flawed concept.”

GPA Chief Executive, Colin Bettles, said the ANU report concludes there are two alternative funding approaches, which align with good sensible policy.

The first is to increase charges for those who create the biosecurity threats, such as importers and travellers, and the second is to further fund biosecurity protection through general revenue, given that the benefits flow to all Australians.

Mr Bettles said the report’s release also coincided with importers offering to pay the $50 million to be raised by the biosecurity tax, instead of producers, accepting they’re the actual biosecurity risk creators and the public benefits as a whole from biosecurity, not just producers.

“The Freight & Trade Alliance and Australian Peak Shippers Association say they agree that the new levy/tax is fundamentally flawed and an unworkable policy,” he said.

“They’ve proposed an alternative three-point plan whereby they, as the biosecurity risk creators, would pay the $50m proposed to be collected by the biosecurity tax, through increased importer charges, in exchange for improvements in productivity and the provision of government services.

“This proposal was covered in a recent ABC Radio interview HERE with industry representatives and is worth listening to; especially in the context of the ANU’s new analysis and clear observations about who should in fact be paying the BPL.”


TTPI Analysis Conclusion

‘First announced in the 2023-24 federal budget, and set to be introduced in July, the BPL has faced criticisms from producers and policy observers alike. The Productivity Commission’s recent report on levies clearly identifies the potential weaknesses of the proposed BPL. First principles analysis of externalities by TTPI accepts and builds on these critiques. Based on these critiques, there is reason to consider two alternatives for what optimal biosecurity funding policy might look like, both of which already exist in conjunction in the Australian policy setting. The first is to increase charges for those who create the biosecurity threats, such as importers and travellers, and the second is to further fund biosecurity protection through general revenue, given that the benefits flow to all Australians.’



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