Commonwealth Numbered Regulations - Explanatory Statements

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PRIMARY INDUSTRIES (EXCISE) LEVIES AMENDMENT REGULATIONS 2002 (NO. 2) 2002 NO. 55

EXPLANATORY STATEMENT

STATUTORY RULES 2002 No. 55

Issued by the Authority of the Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry

Primary Industries (Excise) Levies Act 1999

Primary Industries (Excise) Levies Amendment Regulations 2002 (No. 2)

Section 8 of the Primary Industries (Excise) Levies Act 1999 (the Excise Act) provides that the Governor-General may make regulations prescribing matters required or permitted by that Act to be prescribed or necessary or convenient to be prescribed for carrying out or giving effect to that Act.

Clause 6 of Schedule 24 of the Excise Act provides that, before making regulations for the purposes of this section, the Minister shall take into consideration any relevant recommendation arising out of consultations between the Minister and the sugar industry organisations.

The sugar industry organisations are prescribed in Schedule 24 to the Primary Industries (Excise) Levies Regulations 1999 as the Australian Cane Growers Council Ltd, the Australian Sugar Milling Council Pty Ltd and the Australian Cane Farmers Association Ltd.

Clause 3 of Schedule 24 of the Excise Act imposes a levy on sugar cane produced in Australia and accepted at a sugar mill for processing. Clause 4 of Schedule 24 of the Excise Act provides that the rate of levy may be changed by regulations but shall not exceed $0.15 per tonne.

Section 30 of the Primary Industries and Energy Research and Development Act 1989 provides for research levy money to be paid to Research and Development Corporations. The sugar cane research levy has been attached to the Sugar Research and Development Corporation (SRDC) since 1 October 1990.

The Commonwealth Government contributes matching amounts, which combined with the industry contributions under the Excise Act, cover research expenditure recommended by the SRDC and approved by the Minister. In any one financial year the Commonwealth contribution is limited to 0.5 per cent of the gross value of production (GVP). Estimated Commonwealth expenditure for 2002/03 is $4.3 million.

The sugar industry organisations have requested an increase in the sugar cane levy rate from $0.12 per tonne to $0.14 per tonne for the 2002/03 season. The Amendment Regulations impose a new rate of 14 cents per tonne consistent with the sugar industry organisations' recommendation. The new rate will apply from 1 April 2002 to ensure that it applies to the entire 2002 harvest.

The operative levy rate was reduced from $0.15 per tonne to $0.12 per tonne for the 2001 season because of the significant reduction in sugar industry incomes at that time as a result of a combination of reduced production, primarily because of adverse weather and rust problems, and low world prices. The request to increase the operative levy rate reflects an expected increase in the production of cane from 32 million tonnes in 2001/02 to over 38 million tonnes in 2002/03.

The additional revenue generated by the increased industry contributions will provide a timely boost for SRDC resources which have been affected by the recent industry downturn. In particular, it will significantly increase the scope of the SRDC to fund new project proposals in 2002/03.

Details of the Primary Industries (Excise) Levies Amendment Regulations 2002 (No. 2) are at Attachment 1.

The regulations commence on 1 April 2002.

ATTACHMENT 1

Regulation 1 provides that the Regulations be known as the Primary Industries (Excise) Levies Amendment Regulations 2002 (No. 2).

Regulation 2 provides that the Regulations commence on 1 April 2002.

Regulation 3 provides for the Primary Industries Excise Levies Regulations 1999 to be amended as set out in Schedule 1.

Schedule 1

Clause 1 sets the operative rate of levy applicable to leviable sugar cane at $0.14 per tonne. This represents an increase of 2 cents per tonne.


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