Biosecurity levy collection: a compliance “nightmare”, warns NFF

Farmers will have to pay about $500 each in biosecurity levies from July 1, but its collection is set to be a “compliance nightmare”. See the latest.

Federal Agriculture Minister Murray Watt has failed to detail how the government will calculate and collect $47.5 million in new biosecurity levies from 87,800 farmers from July 1.

The average Australian farmer will have to hand over about $500 a year in biosecurity protection levies in 2024-25, according to the Albanese Government’s own analysis.

But just how the levy will be calculated and collected remains a mystery, less than four months out from its July 1 introduction.

Last year’s federal budget papers estimated it would collect $47.5 million in biosecurity levies from agricultural, fisheries and forestry producers, the bulk of which will come from 87,800 farmers.

Federal Agriculture Minister Murray Watt announced last month the levy would be based on collecting $500,000 per percentage point of each rural sector’s gross value of production.

But it takes the Australian Bureau of Statistics up to two years to compile GVP data, which means it will have to be based on historic rolling averages or an out-of-date season.

The National Farmers Federation has also queried where along the supply chain the levy will be collected and how it will be calculated, given the enormous variation between farming sectors in the calculation of GVP.

A Department of Agriculture, Fisheries and Forestry spokeswoman said the levy would be collected using arrangements already in place for existing agricultural levies.

Yet cracks have emerged in such a proposal, given cattle transaction levies are set at a flat $5 a head and those for chicken meat and eggs are a set amount per chick or bird, which are unrelated to each sector’s gross value of production.

The transaction levy on beef cattle is a flat $5 a head, which is unrelated to the sector’s $15.3 billion gross value of production.

NFF president David Jochinke said “administering the levy based on GVP would be extremely complex and make compliance a nightmare, especially for the likes of livestock producers with multiple transactions in the supply chain”.

“It’s inconceivable we are supposedly less than four months away from the levy being introduced, yet farmers have seen no formal detail around rates or how it will be collected,” he said.

“We’re extremely concerned that setting up this complex and flawed tax will cost more than its worth.”

AgForce chief executive Michael Guerin said the administrative burden of the levy was “a considerable liability”.

“Even the importers are now suggesting that alternatives should be found to the levy because they can see the bureaucratic burden that it will impose,” Mr Guerin said.

The Freight & Trade Alliance came out this week offering to take on farmers’ $47.5m share of the levy in return for the government regulating against the current incontestable stevedore and empty container park terminal access charge, currently costing importers and exporters an estimated $850m a year.

The government is yet to respond to the FTA’s proposal.