Biosecurity Protection Levy

In the 2023–24 Budget, the Australian Government announced the biosecurity levy and charge (the BPL) as one of the funding sources for its election commitment to strengthen Australia’s biosecurity system through a new sustainable funding model. Under the new model, funding of the biosecurity system would be more broadly based and ‘shared across general taxpayers, importers, and Australia Post, as well as a modest contribution from domestic producers (ie primary producers) via the proposed new BPL.

For reasons of convenience, the Government has proposed to use the Primary Industries Levies and Charges legislation to collect the levy. The farming community including Australian Grape & Wine have put a great deal of effort into advocating against the BPL labelling it as a new tax on primary producers. Concerns have been raised across agricultural sectors that unlike traditional biosecurity funding, which is directly reinvested into specific biosecurity projects, the proposed levy will contribute to general consolidated revenue. Furthermore, this government or future ones, have no obligation to use the revenue received for the purposes for which it was collected. To that fact, it meets the definition of a tax rather than a levy. It is estimated the BPL will collect around $50 million per year from primary producers. AGW’s submissions are here and here.

Under the existing agricultural levy system, several types of levies and charges are imposed to facilitate investment in research and development, marketing and biosecurity responses, and for some agriculture sectors for residue testing. The wine sector levy investments are managed by Wine Australia with a small component going to Plant Health Australia for biosecurity. Unlike these other industry levies, this new levy appears to serve the purpose of subsidising the existing Commonwealth biosecurity system. It will have little, if any, control by industry so should not be confused with other biosecurity levies such as the PHA levy or the South Australian Vinehealth levy.

The first proposal set the rate at 10% of existing levies meaning that the wine grape contribution was $1.7 million (based on both levies and the wine export charge).  We argued that applying it to both grapes and wine was double dipping. As a result, under the revised model the wine grape contribution has been estimated to be substantially lower. It is yet to be determined whether the existing proportionality for the PHA component of the GRL and WGL be replicated for the BPL (where growers currently pay 1.6c per tonne and winemakers pay 2.4c per tonne). The actual industry specific BPL rates are being published in tranches, and wine grapes have not been published yet.   Commodities that have been published are listed here.

On 21 March 2024, the Senate referred the provisions of related Bills recommending that the bills be passed. At the time of writing the Senate had not yet voted on the Bill although the cross-bench had indicated that they would not provide the support it required.

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