PLEASE EXPLAIN: The road freight sector has joined with other stakeholders to hit out at a potentially crippling cargo levy announced in the Federal Budget.
PLEASE EXPLAIN: The road freight sector has joined with other stakeholders to hit out at a potentially crippling cargo levy announced in the Federal Budget. Contributed

New biosecurity levy slammed as cash grab

PEAK body Road Freight NSW has described the new biosecurity levy on cargo, announced in the recent Federal Budget, as a "re-run” of the crippling port surcharges already imposed on truck operators.

Road Freight NSW joined supply chain stakeholders in calling for further details from the Federal Government on the justification for the new levy, a charge of $10.02 per incoming container and $1 per tonne of non-containerised cargo, which would generate an additional $360 million in revenue.

"From our perspective, it's a re-run of the port infrastructure surcharges which have been slapped on truck operators with no consultation, no explanation and certainly no justification. Nothing more than a blatant cash grab,” Road Freight NSW chief executive officer Simon O'Hara said.

"Of the $360 million raised through the biosecurity levy, it's estimated that only $76.6 million is actually being spent on biosecurity - that's why it's only fair and reasonable that our industry stakeholders are calling on the government to explain where the rest of the money will be used.

"Undoubtedly, such a blanket surcharge, like the port infrastructure taxes imposed on truckies, will simply be added to goods all through the supply chain.

"Everyone in the freight logistics sector will be hit, and hurt, by this new tax.

"Our members, who are already struggling to operate on increasingly tight margins as a result of the port taxes imposed by stevedores, are going to be impacted. And ultimately, so will Australian consumers who will be paying more for their imported goods.

"RFNSW joins the Australian Logistics Council, Australasian Railway Association, Ports Australia and Shipping Australia in raising our concerns about this new import tax and calling on the government to give us a please explain.”

A request from Big Rigs for Agriculture Minister David Littleproud to respond went unanswered by deadline for this issue.

But an independent review chaired by Wendy Craik, former executive director of the National Farmers' Federation, received by the government in July last year recommended the levy to help meet biosecurity detection and enforcement overheads.

The Queensland Trucking Association joined the growing chorus of disapproval from industry stakeholders to the new tax, which is due to come into effect from July next year.

"As it is we pay state registration charges, we pay fuel excise, we pay significant tolls across the country, and port charges area now ever-increasing. Where does it all stop?” said QTA CEO Gary Mahon.

"We still need to be a competitive industry, and to compete with our international exposure we need to make sure transport costs are not an undue burden for our importers/exporters, and/or the domestic freight because ultimately those costs do get passed on.

"It's not a magic pudding; if you impose those costs on the industry, they'll be passed on in one way or the other down the chain.

"There's a limit to what our people can absorb and remain competitive to breathe energy and life into their businesses.”

ALC managing director Michael Kilgariff also weighed in on the issue, saying measures in the Budget were expected to be accurately costed and there should be no exception for this one.

"Until such details are made clear, a broad charge on every item imported from another country simply cannot be justified,” he said.

"The freight logistics sector should not be used as a cash cow to fund unrelated Budget initiatives,” he said.

"Not only will everyday consumers be impacted by this measure on containerised goods, but anyone importing non-container goods will pay $1 a tonne; that means a construction business importing 50,000 tonnes of concrete will now have to pay an additional $50,000. Imagine the impact such a measure will have on infrastructure costs.”

SAL chief executive Rod Nairn said that, as things stood, the levy measure had no clarity, no plan and no purpose.

"A budget that at its core promises tax cuts for all Australians will simultaneously slug Australians almost $290 million to import the goods they use every day, with no clear explanation of the biosecurity benefit,” Mr Nairn said.

"If $360 million is needed to protect Australia's unique environmental assets then there should be a plan detailing precisely what the money is paying for and how the government arrived at the figure. This is another example where one sector of the supply chain is being forced to fund something that is not directly related.”

Ports Australia chief executive Mike Gallacher said the lack of detail on the proposal lent weight to the impression that it was a broad import levy across all goods coming into the country.

"Our concern is that this import levy has been announced with almost no engagement with the supply chain and with no plan on how it will be used in the biosecurity system,” he said.

A statement on the Department of Agriculture and Water Resources' website said it would consult and work with affected stakeholders such as cargo importers and stevedores over the next 12 months on the design of the legislation and transitional arrangements.

"This includes implementing processes and system upgrades to support collection, and reconciliation of levy payments.”

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