Commonwealth Numbered Regulations - Explanatory Statements

[Index] [Search] [Download] [Related Items] [Help]

WHEAT INDUSTRY FUND LEVY (CUTOFF TIME) REGULATIONS 1999 1999 NO. 126

STATUTORY RULES 1999 No. 126

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

Wheat Industry Fund Levy (Cutoff Time) Regulations 1999

The Wheat Industry Fund Levy (Cutoff Time) Regulations 1999 prescribe a 'cutoff' time of 31 December 1999 after which the Wheat Industry Fund (WIF) component of any levy imposed under the neat Industry Fund Levy Act 1989 which is received by the Commonwealth after 1 July 1999, will cease to be payable to AWB Ltd.

Subsection 11(1) of neat Marketing Legislation Amendment Act 1998 (the Act) provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed; or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

Background/context

The Act provides for privatisation on 1 July 1999 of AWB Ltd, a wholly owned subsidiary of the statutory Australian Wheat Board (AWB). A Class controlling shares will be issued to wheat growers and the AWB's shareholding will be cancelled. In addition, the WIF which has been built up by a compulsory levy and managed by the AWB, will be converted to B Class shares in AWB Ltd and issued on the basis of units allocated to WIF equity holders.

'Cutoff' time

The wheat levy which is imposed under the Wheat Industry Fund Levy Act 1989 on wheat sold or processed, comprises a research component and a component which is paid to the AWB for the purposes of the WIF. The WIF and its levy are to cease on 1 July 1999. Under the provisions of the Primary Industries Levies and Charges Collection (Wheat) Regulations, levy is not due for payment to the Commonwealth until the 20 day after the end of the quarter in which the levy is imposed. Levy which is not remitted by the due date incurs a penalty.

Although the WIF component of the wheat levy will cease to be imposed from 1 July 1999, it is likely that outstanding levy and or penalties from previous quarters will continue to be collected by the Commonwealth for some time. Subsections 8(1) and (2) of the Act provide for those monies to be paid to AWB Ltd, and the constitution of that company provides for the issuing of B Class shares in respect of that levy as though it had been a WIF unit.

After examining the pattern of levy receipts over a number of years and following consultation with the Grains Council of Australia (GCA), the Regulations set the 'cutoff' time at 31 December 1999. This timetable provides an appropriate balance between the entitlement of WIF levy payers to receive the B Class shares and the administrative impost, and associated costs, on the Commonwealth and AWB Ltd of pursuing very small amounts of outstanding levy. These costs are ultimately borne by growers across the industry.

Details of the Regulations are as follows:

Regulation 1 names the regulations the Wheat Industry Fund Levy (Cutoff Time) Regulations 1999.

Regulation 2 provides for the neat Industry Fund Levy (Cutoff Time) Regulations 1999 to commence on gazettal.

Regulation 3 prescribes a 'cutoff' time, for the purposes of Section 8 of the Act, of 31 December 1999. Any outstanding WIF component of the wheat levy which was imposed before 1 July 1999 but collected by the Commonwealth after that date, will be payable to AWB Ltd only until the end of 31 December 1999.