Commonwealth Numbered Regulations - Explanatory Statements

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PRIMARY INDUSTRIES (EXCISE) LEVIES AMENDMENT (AGARICUS MUSHROOMS) REGULATIONS 2018 (F2018L00614)

Explanatory Statement

Issued by Authority of the Minister for Agriculture and Water Resources

Primary Industries (Excise) Levies Act 1999

Primary Industries (Excise) Levies Amendment (Agaricus Mushrooms) Regulations 2018

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

Subclause 4(1) of Schedule 15 to the Excise Levies Act provides that the regulations may fix a rate of levy in relation to a class of leviable horticultural products.

The Primary Industries (Excise) Levies Amendment (Agaricus Mushroom) Regulations 2018 (the Amendment) decreases the marketing levy component on mushrooms from $3.24 to $2.92 per kilogram of mushroom spawn sold.

The Amendment reduces the current marketing levy by less than 10 per cent. This reduction reflects the mushroom industry's desire to remain profitable and sustainable through reducing costs, while not impacting upon research and development (R&D) investment priorities.

On 22 August 2017, the Australian Mushroom Growers' Association (AMGA) wrote to the Minister for Agriculture and Water Resources with a proposal to reduce the marketing component of the mushroom levy from $3.24 to $2.92 per kilogram of mushroom spawn sold. The R&D component remains unchanged at $1.08 per kilogram. The Amendment reduces the overall rate of the levy from $4.32 per kilogram of mushroom spawn to $4.00 per kilogram.

The mushroom levy rate was doubled in 2014, principally to fund market research activities.  AMGA proposed a review of the arrangements at the end of 2016. The requested reduction to the marketing levy is the result of that review.  AMGA consulted widely on the proposal to reduce the levy and it has majority industry support. The industry services body, Horticulture Innovation Australia, was consulted in September 2017 and did not raise any objections, or make any recommendations to the Minister for the purpose of clause 6 of Schedule 15 to the Excise Levies Act.

An objection period for the proposal commenced on 25 September 2017 and closed on 6 November 2017. The Department of Agriculture and Water Resources assessed AMGA's proposal and considers that it meets the Australian Government's Levy Principles and Guidelines.

Reducing the marketing component of the levy has a positive financial impact for mushroom growers. There is no financial impact on the Commonwealth, as the marketing levy is not eligible for Australian Government matching funds.

The Office of Best Practice Regulation was consulted in the preparation of the Regulation (ID 22734).

Details of the Regulations are set out in Attachment A.

The Regulations are compatible with the human rights and freedoms recognised or declared under Section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. A full statement of compatibility is set out in Attachment B.

The Regulation is a legislative instrument for the purposes of the Legislation Act 2003.