Grain Producers Australia is calling on the Federal Government to urgently revisit the proposed 10 per cent Biosecurity Levy/Tax, following release of a new Productivity Commission report which raises serious concerns about creeping inefficacies with levies, as a substitute for taxation.
“This new analysis has clearly belled the cat on the government’s deeply flawed policy proposal and called it for what it really is – another tax on all Australian agricultural producers,” GPA Chair and WA grain producer Barry Lage said.
“The Productivity Commission’s research has clearly underlined what the vast majority of Australian producers have been saying since the federal budget in May, that this is in fact a 10pc tax, not a levy.
“If it looks like a tax, acts like a tax, and smells like a tax, let’s not pretend it’s a levy.
“This new report reinforces our concerns that the longer this policy push persists, the more damage it will do by undermining trust and confidence in the long-term partnerships industry has established with government, through the current ag-levy system – including stronger biosecurity programs.”
Mr Large said Prime Minister Anthony Albanese and Agriculture Minister Murray Watt needed to demonstrate they’re listening and act immediately by addressing the fatally flawed policy plan and one-size fits all policy push.
“If they want to continue calling it a levy, even though the funding is going into consolidated government revenue with no transparency or accountability, and producers are not the only beneficiaries, they’re actually choosing to deepen divisions with the agricultural sector,” he said.
“Biosecurity should be a bipartisan issue but this proposed tax is creating political conflict, confusion and division where none is needed. And this is happening at a time when farmers need to be better supported and key partnerships strengthened, to enhance biosecurity protections.”
WAFarmers Grains Council President, Mark Fowler, said the federal government had not consulted or been transparent with producers and industry in building a case for producers to shoulder an additional burden towards biosecurity funding when they are not the key point of risk.
“WAFarmers strongly opposes the introduction of a tax on agricultural producers along with strongly opposing that any funds collected via this levy be directed into consolidated revenue,” he said.
“WAFarmers producer members already contribute their equitable ‘Shared Responsibility’ through contributing existing producer levies, import levies on the goods they import, as a taxpayer and through passenger traveller levies.”
Mr Large said grain producers and other farmers also contributed millions of dollars directly to biosecurity in state levies, as well as direct financial contributions within their own businesses.
“The Productivity Commission report asks the question – is the levied sector (producers) the only sector that will benefit from the funding of the public good – and the answer is ‘No’,” he said.
“This was an extremely predictable response and one the government could have easily found out, by asking farmers what they thought first, before announcing this new tax in the budget.
“The new report also shows that there’s been no proper analysis or cost-benefit analysis either, to clearly justify its implementation and imposition on producers versus risk-creators – and a clear lack of any policy rationale, other than being a government cash grab.”
Excerpts from Productivity Commission Report below – full report HERE
Is the levied sector the only sector that will benefit from the funding of the public good?
No. The Biosecurity Protection Levy is proposed to be applied to domestic primary producers only, while the benefits of biosecurity are shared across a broad range of sectors and the broader community.
Why only target this sector? Community-wide public goods are more readily funded out of general revenue.
Are the economic benefits of the sectoral public good greater than the costs of the industry levy?
Unclear in the absence of detailed, sector-specific, cost benefit analysis of the proposal.
Potential for some individual sectors to face additional costs from the levy that are greater than the benefits that they receive.
Is there widespread industry support for the levy?
No. It is understood that primary producers are generally opposed to the imposition of the levy.
Might suggest that industry does not regard the funded activities as true sectoral public goods
Can the sectoral public good be funded at lower cost by an industry levy than through general revenue?
Unlikely. Industry levies are a generally less efficient form of funding than general revenue.
May fund policy intervention at a higher cost than is necessary.