EXPLANATORY STATEMENT
Select Legislative Instrument 2010 No. 2
Issued by the Authority of the Minister for Agriculture, Fisheries and Forestry
Primary Industries (Excise) Levies Act 1999
Primary Industries (Excise) Levies Amendment Regulations 2010 (No. 1)
Section 8 of the Primary Industries (Excise) Levies Act 1999 (the Act) provides, in part, 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.
Schedule 15 to the Act provides for the imposition of excise levy on horticulture products, including macadamia nuts, and subclause 2(4) of the Schedule provides that the regulations may exempt from levy imposed on leviable horticultural products produced by specified classes of producers, or specified subclasses of a class of leviable horticultural products
Schedule 15 to the Primary Industries (Excise) Levies Regulations 1999 (the Principal Regulations) currently sets the rate of levy for macadamia nuts. The macadamia levy is payable on macadamia nuts produced and sold in Australia or used in the production of other goods. The levy is payable by the producer of the macadamias. The levy is not imposed on macadamia nuts where the total amount of levy (or equivalent export charge) that a person would be liable to pay in a levy (calendar) year is less than $120.
The Regulations amend the Principal Regulations to exempt from levy macadamia nuts used in the production of oil and other products that are not for human consumption. This exemption was requested by the Australian Macadamia Society (AMS) so that no levy should be payable on macadamia nuts used for these purposes as the return to producers for these nuts is substantially lower than for higher quality nuts.
Subclause 6(3) of the Act prescribes that before the Governor-General makes regulations for the purposes of subclause 2(4), the Minister for Agriculture, Fisheries and Forestry must take into consideration any relevant recommendation made to the Minister by the industry services body. Horticulture Australia Limited is the prescribed industry services body for macadamias and it undertakes marketing and research and development activities for the macadamia industry funded by the macadamia levy. Subclause 6(7) of the Act prescribes that the industry services body must consult the eligible industry body, in this case the AMS, before making a recommendation for the purposes of subclause 6(3).
Details of the Regulations are contained in Attachment A.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Office of Best Practice Regulations (OBPR) was consulted in the preparation of the Regulations. The OBPR has advised that it is not necessary to prepare a Regulation Impact Statement or Business Cost Calculator for this matter (Reference number 10892).
An OBPR Preliminary Assessment was completed and is at Attachment B.
The Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.
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Attachment A
DETAILS OF THE PRIMARY INDUSTRIES (EXCISE) LEVIES AMENDMENT REGULATIONS 2010 (No. 1 )
Regulation 1 provides for the name of the Regulations to be the Primary Industries (Excise) Levies Amendment Regulations 2010 (No. 1).
Regulation 2 (1) provides for the commencement date to be the day after they are registered.
Regulation 3 provides that Schedule 1 amends the Primary Industries (Excise) Levies Regulations 1999.
Schedule 1 Amendment to Schedule 15, Part 10, clause 10.2, including the notes
Item [1] substitutes clause 10.2, including the notes, with a new subclause which adds the following subclasses of macadamia nuts to the list of exemptions from levy:
(a) macadamia nuts used by the producer to manufacture oil;
(b) macadamia nuts used by the producer to manufacture goods that are not for human consumption;
(c) macadamia nuts sold by the producer for the manufacture of oil; and
(d) macadamia nuts sold by the producer for the manufacture of goods that are not for human consumption.
Note 1 explains that macadamia nuts are prescribed for the definition of producer under the Primary Industries Levies and Charges Collection Act 1991 (the Collection Act).
Notes 2 and 3 provides a cross reference to the Collection Act and associated regulations for the definitions of charge, levy, producer, deal and levy year in relation to macadamia nuts.
Note 4 states that levy is not imposed on some horticultural products in accordance with the Act.
Attachment B
Best Practice Regulation – Preliminary Assessment
This Preliminary Assessment form will help you assess whether a regulatory proposal will have a potential impact on business and individuals or the economy and whether further analysis may be required. This form will guide you through the compliance cost impacts and other impacts of your proposal. You should consult the Best Practice Regulation Handbook for more information about the requirements for developing regulatory proposals. All regulatory and quasi-regulatory proposals are subject to these requirements, which are mandated by the Australian Government.
While self assessment is an option at this stage of the policy development process, you are strongly encouraged to contact the Office of Best Practice Regulation (OBPR) to confirm your Preliminary Assessment and for advice and support. If you incorrectly assess the impact of your proposal it may not be allowed to proceed to the decision-maker. Contacting OBPR early in the policy development process will help departments and agencies progress the proposal through decision making forums, such as Cabinet, in a timely manner; ensure full compliance with the Governments requirements; and avoid the need for post- implementation reviews within one to two years. Note that the preliminary assessment should be informed by consultation with stakeholders.
Department of Agriculture, Fisheries and Forestry
Macadamia Levy - Primary Industries (Excise) Levies Regulations 2010 (No. 1)
The proposed change will exempt from levy macadamia nuts used in the production of oil or used in the production of goods that are not for human consumption.
Section 1: Business Compliance Costs
The following checklist will help you identify if the proposal has the potential to increase compliance costs.
Will businesses incur costs when they are required to report certain events? o Yes ý No
Will costs be incurred by business in keeping abreast of regulatory requirements? o Yes ý No
Are costs incurred in seeking permission to conduct an activity? o Yes ý No
Will businesses need to purchase materials, equipment, or external services? o Yes ý No
Will businesses need to keep records? o Yes ý No
Will businesses incur costs when cooperating with audits or inspections? o Yes ý No
Will businesses incur costs when producing documents? o Yes ý No
Will businesses incur costs from other changes to their procedures or practices? o Yes ý No
Are there any other compliance costs, including indirect costs or impacts on intermediaries such as accountants, lawyers banks or financial advisers? o Yes ý No
If you have answered ‘no’ to each of these questions there would appear to be no compliance costs to business. You will need to include an explanation of the reason for this assessment at the end of this form. You can now proceed to Section 2.
If you have answered ‘yes’ to any of these questions, you will need to determine if business compliance costs are low. In general, compliance costs to business would be low when only a few businesses are affected and the costs are negligible or trivial.
For example:
- changes to regulation that are machinery in nature, involving technical changes which will not have an appreciable impact on business and are consistent with existing policy (such as indexation);
- there would be a very small initial one-off cost to business and no ongoing costs.
Proposals which have a broad impact (that is, affect a large number of businesses), or which involve a cost per business which is not negligible (in relation to the size of businesses involved), would not be considered to generate low compliance cost impacts. In these cases departments and agencies should contact OBPR which will determine the level of regulatory impact assessment required.
Will this proposal have low compliance costs on business? o Yes o No
If you answered ‘yes’ to this question you will need to include an explanation of the reason for this assessment at the end of this form. You can now proceed to Section 2. If you are unsure, contact the OBPR.
If you have answered ‘no’ to this question or are uncertain, please contact the OBPR for advice on the appropriate level of analysis and further information.
Section 2: Other impacts on business and individuals or the economy
You should also identify any other potential impacts on business and individuals or the economy which require or encourage businesses to alter their behaviour.
Regulation has an impact on business and individuals if it imposes a cost or confers a benefit. This includes proposals that restrict or promotes competition. These impacts may be positive or negative, financial or non-financial, direct or indirect and may be market or non-market impacts.
The following checklist will help you to assess whether a proposal has a potential impact on business and individuals or the economy.
Will the proposal:
Potentially affect the number and range of businesses in an industry? o Yes ý No
For example: Change the ability of businesses to provide a good or service;
Change the requirements for a licence, permit or authorisation process as a condition of operation;
Affect the ability of some types of firms to participate in public procurement;
Significantly alter costs of entry or exit to an industry; or
Change geographic barriers for businesses.
Potentially change the ability of businesses to compete? o Yes ý No
For example: Control or substantially influence the price at which a good or service is sold;
Alter the ability of businesses to advertise or market their products;
Ban certain types of products or business practices;
Set significantly different standards for product/service quality; or
Significantly alter the competitiveness of some industry sectors.
Potentially alter a business’s incentives to compete? o Yes ý No
For example: Create a self-regulatory or co-regulatory regime;
Impact on the mobility of customers between businesses;
Require/encourage the publishing of data on company outputs/price, sales/cost; or
Exempt an activity from general competition law.
Potentially impact on consumers? o Yes ý No
For example: Alter the choices available to consumers;
Affect the quality of consumer products or services;
Create or remove restrictions on access to a product;
Promote or restrict information dissemination to consumers; or
Add to or reduce the complexity of consumer products or services.
Potentially have any other impacts on business and individuals or the economy? o Yes ý No
For example: Mandate payments from one party to another (excluding taxes);
Have environmental or social impacts (including distribution of resources);
Create or amend government cost recovery arrangements;
Impact on Australia’s international capital flows or trade;
Impact on mobility of labour;
Impact on resource allocation, saving or investment;
Transfer risk between business, individuals and government; or
Impose any other financial costs.
If you have answered ‘no’ to each of these questions, you will need to include an explanation of the reason for this assessment at the end of this form (Section 3).
If you answered ‘yes’ to any of these questions, you will need to determine if other impacts are low. In general, impacts would be low when only a few businesses are affected and the impacts are negligible or trivial.
Will this proposal have low other impacts on business and individuals or the economy? o Yes o No
If you answered ‘yes’ to this question, you will need to include an explanation of the reason for this assessment at the end of this form. You can now proceed to Section 3. If you are unsure, contact the OBPR.
If you answered ‘no’ to this question or are uncertain, please contact the OBPR for advice on the appropriate level of analysis and further information.
Section 3: Rationale for Your Assessment of Low or No Impact
You should provide an explanation for why you have assessed business compliance costs as low or nil and why you have assessed other impacts on business and individuals or the economy as low or nil.
The proposal would amend the macadamia levy part of the Primary Industries (Excise) Levies Regulations 1999 so that macadamia nuts used in the production of oil or used in the production of goods that are not for human consumption would be exempt from the levy. The macadamia levy is payable on macadamia nuts produced and sold in Australia or used in the production of other goods. The levy is payable by the producer of the macadamias. The levy is not imposed on macadamia nuts where the total amount of levy (or equivalent export charge) that a person would be liable to pay in a levy (calendar) year is less than $120. This amendment would reduce the macadamia levy liability for certain levy payers and there would be no additional administrative work to comply with the regulations. No changes are proposed to reporting or recordkeeping requirements.
Section 4: Next Steps
If you are uncertain about the impact of a proposal, you should forward of copy of this preliminary assessment, along with a clear outline of the proposal and its possible impacts, to the OBPR, which will determine the level of analysis required.
You should keep this form and any supporting documents, including a clear outline of the proposal to which it relates and its impacts, on file and send a copy to the Best Practice Regulation Coordinator in your department or agency.
Signature:
Name: Alicia Glenn
Date: 30 October 2009
Office of Best Practice Regulation: t: 02 6215 1955 │e:helpdesk@obpr.gov.au │www.obpr.gov.au