Levies Explained

​​​Overview

Australian farm businesses are world leaders in terms of production efficiency, sustainability, product quality, innovation and ability to supply and respond to market needs.

The Australian Government and agriculture , fisheries and forestry industries recognise the importance of coordination to ensure these results benefit individuals and the industry as a whole.

Levies and charges are taxes initiated by primary industries and imposed on the producers in that industry. The term 'levies' applies to taxes imposed on domestic products. The term 'charges' applies to taxes imposed on imported and exported products.

Effective use of primary industry levies and charges can greatly assist producers. By pooling their effort and resources, industries can work together to find solutions to priority issues. Many of Australia’s primary industries strongly value the levy system and the support it provides.

The system has enabled established industries to maintain their standing in highly competitive world markets. Smaller and emerging industries also value the benefits of industry cooperation and resource sharing.

The government's role, through the Department of Agriculture , Water and the Environment, is to liaise with industries that want a levy and to implement an effective collection system at minimum cost.

Why do we have levies and charges?

Industry members pay primary industry levies and charges to fund research and development (R&D), marketing , biosecurity activities such as plant and animal health programs, biosecurity emergency responses and residue testing activities that benefit industry.

In many cases, and within certain prescribed limits, the government matches the R&D component of levies on a dollar for dollar basis.

How are levies and charges initiated?

An industry representative body usually identifies a problem or opportunity facing industry and the need to respond with collective industry funding via a levy or charge. The industry body should consult with the department and follow the guidance in the Levy guidelines: How to establish or amend agricultural levies when preparing a case for a levy or charge to be considered by industry members. If a majority of industry participants support the levy or charge proposal, the industry body submits the proposal to the Minister for Agriculture, Drought and Emergency Management for consideration. If approved, the levy or charge is imposed and collected under legislation.

In some circumstances, the government may introduce or change a levy or charge in the public interest , in consultation with the industries involved.

Levy guidelines: How to establish or amend agricultural levies

The Levy guidelines: How to establish or amend agricultural levies will support agricultural, fisheries and forestry industries through the process of developing a proposal to establish or amend a legislated agricultural levy or charge. It outlines the usual steps needed to design a levy, consult with industry stakeholders, and draft and submit a proposal to the Australian Government.

The processes described in the Levy guidelines: How to establish or amend agricultural levies will also be used by departmental officers to assess the soundness of a levy proposal and to advise the Minister on likely associated costs of collection, regulatory impact and necessary legislative changes.

The Levy guidelines: How to establish or amend agricultural levies can be downloaded from the publications page.

Collection and administration of levies and charges

The Department of Agriculture, Water and the Environment, under Commonwealth legislation, is responsible for the effective collection, disbursement and administration of levies and charges on a range of rural commodities and products.

The department collects levies and charges on more than 70 commodities from over 7,000 collection agents including intermediaries and producers. These monies are then paid to the relevant R&D and marketing bodies, as well as to Animal Health Australia, Plant Health Australia and the National Residue Survey, to fund activities that benefit levy paying industries. To find out which commodities have a statutory levy or charge please visit the levy rates and commodity details page.

The department also distributes the government’s matching funds for R&D, as determined by the legislation.

To ensure that all levy payers contribute fairly to the funding of their own industry’s activities, the department conducts regular record inspections of levy payers to confirm levies and charges are being paid correctly.

The department recovers its costs under the government cost recovery guidelines. To view these visit the Australian Government Charging Framework page.

Accountability

Levy recipient bodies are accountable to levy and charge payers and to the government. They have various legislative and governance requirements they must uphold, including holding annual general meetings, publishing annual reports, and maintaining strategic plans that identify their priorities.

The department reports annually to industry representative bodies and to levy and charge recipient bodies on its collection and administration activities.

How are levies and charges used?

Activities funded by levies and charges include R&D, marketing , biosecurity activities such as plant and animal health programs, biosecurity emergency responses and residue testing for levy paying industries. For information on these activities, refer to the relevant recipient body’s website.

Who should keep records? Which records? How long should they keep them for?

Anyone who lodges returns to the department must keep records supporting the information they supplied in their returns and anyone who pays levy/export charge to an intermediary must keep information on those payments. They must keep these records for five (5) years and must make them available to departmental levies officers.

Are there any penalties for late payments or other offences?

If you pay your levy late, you will be penalised at the rate of 2% per month. This will compound on the total of the unpaid amounts, including any penalties you have already accrued, until you have paid the outstanding levy in full.

There are also penalties for other breaches of legislation. For more information, please contact your Department of Agriculture, Water and the Environment – Levies state office.

Giving false or misleading information is a serious offence.

Levies Online

The department has introduced the Levies Online system that allows levy payers to lodge their levy returns online as well as change account details and view previous returns and payments. On registration, online users receive a username and password to access web -based versions of the current levy forms. Submitting levy returns online helps to minimise the cost to industries of processing returns.

Find out more about Levies Online.

Note:If you have never paid a levy before, please contact the Department of Agriculture, Water and the Environment - Levies to register.

Last reviewed: 21 August 2020
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