EXPLANATORY STATEMENT
STATUTORY RULES 1988 NO.132
Issued by the authority of the Minister for Primary Industries and Energy
DAIRY PRODUCE LEVY (NO 1) ACT 1986
DAIRY PRODUCE LEVY REGULATIONS (AMENDMENT)
The Dairy Produce Lew (No 1) Act 1986 (the Act) provides for the Governor-General to make regulations for the purposes of financing aspects of the new dairy industry arrangements which are implemented under the Dairy Produce Act 1986.
The Act finances the arrangement by imposing four levies on the milk fat content of relevant dairy produce (whole milk and whole milk products). The four milk fat levies and the purpose of each are:
• the market support levy - to provide the moneys for market support payments on exported dairy produce under the Dairy Produce Act 1986
• the Corporation levy - to cover the administrative costs of the Australian Dairy Corporation which is established by the Dairy Produce Act 1986
• the promotion levy - to fund Corporation activity in promoting dairy products
• the research levy - to fund dairy industry research.
The purpose of the Regulations is to set the operative rate of the market support levy imposed by the Dairy Produce Levy (No 1) Act 1986.
The Regulations set the market support levy at 45 cents per kilogram of milk fat, the Corporation levy to 1.05 cents per kilogram of milk fat and the promotion levy to 4.95 cents per kilogram of milk fat. The new rates are to apply from 1 July 1988.
The rates were set after the Governor-General had taken into consideration a recommendation with respect to the market support levy rate made to the Minister by the Australian Dairy Corporation in accordance with subsection 14(2) of the Act for the purposes of subsection 7(1) (ie the rate of market support levy); and after the Governor General had taken into consideration a recommendation with respect to the Corporation and promotion levy rates made to the Minister by the executive council of the Australian Dairy Industry Conference in accordance with subsection 14(3) of the Act for the purposes of subsection s 7(2) and 7(3) (ie the rate of the levies).
The rate increases are necessary to provide the Corporation with sufficient funds to make the market support payments anticipated for 1988/89, meet the Corporation’s operating expenses and fund the promotional activities planned for 1988/89.
The levy rates are at or below the permitted maximum rate laid down in section 7 of the Act.
Overview
The Dairy Produce Levy (No 1) Act 1986 was enacted to establish a framework for imposing and collecting levies on milk fat content in relevant dairy produce to support the dairy industry in Australia. This legislation was introduced to address the need for adequate financing to implement new dairy industry arrangements under the Dairy Produce Act 1986. The Act sets out four specific levies, including the market support levy for export market support, the Corporation levy to cover administrative costs of the Australian Dairy Corporation, the promotion levy for funding promotional activities, and the research levy for financing dairy industry research. The Australian Parliament enacted this Act to ensure a stable and financially sustainable dairy industry by providing the necessary funds through these levies. The policy objective is to support the dairy industry's financial needs and ensure its stability and growth.
Scope and Application
The Dairy Produce Levy (No 1) Act 1986 applies to all entities involved in the production and sale of dairy products in Australia, encompassing producers, processors, and exporters of milk and milk products. Its jurisdiction extends across the Commonwealth of Australia, ensuring uniform application and regulation throughout the country. The Act imposes four specific levies on the milk fat content of relevant dairy produce to finance various aspects of the dairy industry, including market support payments, administrative costs of the Australian Dairy Corporation, promotional activities, and industry research. The levies are set at specified rates per kilogram of milk fat, with the rates adjusted periodically to meet the financial needs of the industry as determined by the Governor-General based on recommendations from relevant industry bodies. The Act allows for the regulation of these levies through subordinate instruments, ensuring flexibility in adapting to changing industry needs and economic conditions.
Key Provisions
The Dairy Produce Levy (No 1) Act 1986, as amended by these regulations, primarily focuses on establishing and adjusting levy rates for financing specific aspects of the dairy industry. Section 7 of the Act specifies the types of levies applicable to the milk fat content of relevant dairy produce. These levies include the market support levy, the Corporation levy, the promotion levy, and the research levy, each serving a distinct purpose in supporting the industry (sections 7(1) to 7(4)). The market support levy is designed to fund payments for exported dairy products, while the Corporation levy covers the administrative costs of the Australian Dairy Corporation. The promotion levy finances activities aimed at promoting dairy products, and the research levy supports research within the dairy industry.
Under these regulations, the primary obligation imposed on the industry is to pay the specified levies on their milk fat content. The levies are calculated per kilogram of milk fat and must be remitted according to the rates set out in the regulations. The market support levy is set at 45 cents per kilogram of milk fat, the Corporation levy at 1.05 cents per kilogram of milk fat, and the promotion levy at 4.95 cents per kilogram of milk fat (regulation 3). These rates are effective from 1 July 1988 and are determined after careful consideration of recommendations from relevant bodies such as the Australian Dairy Corporation and the Australian Dairy Industry Conference. The rates were set to ensure sufficient funds are available for market support payments, operational costs, and promotional activities for the financial year 1988/89.
The regulations also establish the consequences for non-compliance with the levy requirements. Any party failing to remit the specified levies within the stipulated timeframes may face financial penalties. The Act does not explicitly detail the penalties, but it is reasonable to infer that non-compliance could lead to fines or other financial sanctions as is common with regulatory breaches in Australia. These penalties are intended to enforce compliance and ensure that the necessary funds are available to support the industry as intended by the Act. The levy rates established are within the maximum limits set by the Act, ensuring they are both effective and legally permissible.