Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
1998-1999-2000
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
PRIMARY INDUSTRIES LEGISLATION AMENDMENT (VEGETABLE LEVY)
BILL 2000
EXPLANATORY MEMORANDUM
(Circulated by authority of the Parliamentary Secretary to the Minister for Agriculture, Fisheries, and Forestry, Senator the Hon Judith Troeth)
ISBN: 0642 438218
The Bill seeks to amend the Primary Industries Levies and Charges Collection (Vegetable) Regulations to clarify the rate of levy intended to be struck on vegetables that were grown and processed by the producer, between 1 March 1996 and 30 June 1999.
The Bill gives effect to a Government and Industry agreement that the procedure used for calculating the levy on vegetables grown and self-processed should be based on the cost of goods sold rather than the inflated value added price at first point of sale. The vegetable levy was intended to be imposed on fresh vegetables, however, in the circumstances described, these vegetables were processed first, and therefore had a significantly higher value added price at their first of sale and thus a higher than normal levy assessment.
The Bill recognises the situation for growers/processors who process vegetables and where there is no sale prior to the harvested product being converted into another good.
The Primary Industries Levies and Charges Collection (Vegetable) Regulations provided that where it was not feasible to use a surrogate market price, the calculation of levy payable will be based on data from the organization’s financial records to substantiate the basic product value prior to processing, using the Australian Accounting Standards calculation of Cost of Goods Sold. The rate of levy is being re-set to 0.5% of this value.
As levy on vegetables grown and self-processed after 1 July 1999 is imposed under Schedule 15 to the Primary Industries (Excise) Levies Act 1999, the levy assessment is unaffected by this Bill.
The value for calculating the levy is now either the actual sale price at the first point of sale or the cost of goods sold, depending on circumstances. The Bill does not create any new administrative burden for levy payers.
The retrospective nature of the legislation.
The original commencement of the vegetable levy was 1 March 1996.
The vegetable levy is normally imposed on fresh vegetables at the first point of sale. However, between 1 March 1996 and 30 June 1999, some of these vegetables were processed by the grower first and thus had a significantly higher value added price at their first point of sale and therefore a higher than usual levy assessment.
To rectify this inequity, the Government and Industry agreed that the basis for calculating the levy on all vegetables grown and self-processed, since the commencement of the levy, should be based on the cost of goods sold rather than the inflated value added price at first point of sale.
The effect of the changes is to reset the levy rate for vegetables grown and self-processed between 1 March 1996 and 30 June 1999. Those producers who sold their vegetables unprocessed will not be affected by these changes.
As the intent of this Bill is to reduce the rate of levy struck on vegetables that were grown and processed by the producer, between 1 March 1996 and 30 June 1999, there will be a retrospective decrease in levy liability for the small number of producer/processors effected. The monetary size of refunds is expected to be minimal.
1. Short title
The
short title of the Bill is the Primary Industries Legislation Amendment
(Vegetable Levy) Act 2000.
The commencement date is set to be immediately after the commencement of the Primary Industries Levies and Charges Collection (Vegetable) Regulations. Those regulations commenced on 1 March 1996. This is essential since the changes in the Bill are to cover vegetables grown and self-processed between 1 March 1996 and 30 June 1999 only.
This provision indicates what the effect is on legislation mentioned and to be amended in the Schedules.
Subsection 4(1) establishes that the amendments made by Schedule 1 are
restricted to vegetables either sold by or used by the producer between 1 March
1996 and 30 June 1999. This ensures that the changes are only to apply prior
to 1 July 1999, the commencement of the Primary Industries (Excise)
Levies Act 1999.
Subsection 4(2) provides that the amendments do
not operate for the purposes of applying clause 7 of Schedule 15 to the
Primary Industries (Excise) Levies Act 1999. The intention is to ensure
that the retrospective regulation is not continued in force after 1 July
1999, the date the Primary Industries (Excise) Levies Act 1999 commenced.
Transactions after 1 July 1999 are covered by the provisions of Schedule 15 to
the Primary Industries (Excise) Levies Act 1999, the Primary
Industries (Excise) Levies (Vegetable) Regulations 1999, and the Primary
Industries Levies and Charges Collection (Vegetable) Regulations
1999.
Subsection 4(3) provides that the amendments being made in this
Bill will not affect the validity of the Primary Industries Levies and
Charges Collection (Vegetable) Amendment Regulations 1999 (No. 1). This is
intended to again highlight that this Bill applies only to transactions that
occurred between 1 March 1996 and 30 June 1999.
The original regulation is repealed and substituted with a new provision
expressed in terms similar to those of regulation 6 of the Primary Industries
(Excise) Levies (Vegetable) Regulations 1999, [Statutory Rules 1999 No.
306]. This is to ensure that assessment of levy on vegetables that are
processed before being first sold is consistent since the inception of the
levy.
The amendment sets out the rate of levy for the Horticultural
Research and Development Corporation and the means of determining the value of
vegetables immediately before processing.