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Tuesday, 26 August 1980
Page: 701

Mr GARLAND (Curtin) (Minister for Business and Consumer Affairs) - I move:

Customs Tariff Proposals Nos. 9 to 1 5 ( 1 980)

The Customs Tariff Proposals I have just tabled relate to proposed alterations to the Customs Tariff Act 1966. Tariff Proposals Nos. 9-14 formally place before Parliament, as required by law, tariff changes introduced by Gazette notices during the last recess. The changes contained in Tariff Proposals No. 15 are new and arise from the Government's decision on the recommendations by the Industries Assistance Commission in its report on chemical products (Part B).

Tariff changes implemented by Proposals No. 9 operate from 1 June 1980 and reduce the rates of duty on phenoxymethyl penicillin and benzyl penicillin to minimum rates. This action follows on from the Government's earlier consideration of the Industries Assistance Commission report of August 1976 on pharmaceutical and veterinary products and complements the introduction of a bounty scheme. The scheme is designed to operate for a period of rive years with an initial overall annual limit of $900,000 and will ensure that penicillin production capacity in Australia is maintained for health and defence purposes.

The changes in Proposals No. 10 which operate from 9 June 1980 give effect to the final phase down in the rates of duty applying to certain medicaments. These changes were agreed to by the Government following general acceptance of recommendations by the Industries Assistance Commission's report on pharmaceutical and veterinary products announced on 10 June 1977.

Proposals No. 1 1 which operate from 1 July 1 980 contain tariff changes as a result of:

(a)   the Government's decision on the recommendations by the Industries Assistance Commission in its report on apples and pears. The effect of this decision provides for free rates of duty to apply to fresh apples, pears and quinces. In accepting the Commission's recommendations the Government agreed to the phasing out of the stabilisation scheme for apples over the next four years and the ending of the stabilisation scheme for pears at the end of the current export season, and the replacement of them both with underwriting schemes;

(b)   the final phase down of rates of duty on certain travel goods resulting from the Government's decision announced on 12 July 1979. This decision followed the report of 1 1 May 1979 by the Industries Assistance Commission on travel goods, brief cases, toilet cases and similar goods;

(c)   the cessation of temporary assistance measures to certain insulators. These moves are in accordance with the Government's announced policy on 9 August 1 979 following the report by the Temporary Assistance Authority of 8 June 1979, on continuation of assistance for insulators;

(d)   an increase in the 'threshold' value for high priced footwear from $26.00 to $27.50. This 'threshold' price level is adjusted each six months in line with movements in the footwear component of the Consumer Price Index and allows high priced footwear exemption from import licencing;

(e)   a further review of the Australian system of preferences for developing countries. The changes relate to: the establishment of a new developing country quota for sanitary ware; the abolition of developing country quota on unglazed ceramic tiles and the setting of duty rates applicable to such goods from developing countries at 1 5 per cent; and a rounding of the capacity limit from 198 litres to 200 litres for small refrigerators subject to developing country quota. The Proposals also contain administrative changes in relation to a number of items. Firstly, the description of non-adult bicycles; a revised description using the line of demarcation expressed in the Australian standard on adult and non-adult cycles has been adopted. The new description has a specific measurement provision and removes any chance of subjective judgment. Secondly, a change in the tariff classification of certain ultraviolet absorbance monitors; no change in rates of duty will result. Thirdly, an amendment of the drafting of tariff item 30.04 covering wadding, gauze, bandages and similar goods more clearly to describe the goods and rates of duty that are intended to apply; this change follows a judgment by the Administrative Appeals Tribunal.

The changes in Proposals No. 12, which operate from 7 July 1980, are the result of a reduction in the margin of preference applying to certain white goods, such as refrigerators, freezers, washing machines, dryers and airconditioning equipment from New Zealand. On implementation of the Government's decision on the Industries Assistance Commission's report of 3 February 1978 on domestic refrigerating appliances, it was decided to establish a margin of preference of 17.5 percentage points for these goods. The preference was to be an interim arrangement pending review of Schedule B arrangements to the New ZealandAustralia Free Trade Agreement. As agreement was not reached the margin of preference in favour of New Zealand has been reduced to 1 5 percentage points.

Tariff Proposals No. 1 3, which operate from 24 July 1980, implements the Government's decision on the report of 5 May 1980 by the Industries Assistance Commission on polymeric plasticisers and certain polyester polyols. The Government has accepted the Commission's recommendation that increased assistance to the industry would reduce distortions in the use of resources among competing products. The rate of duty has been raised from 6 per cent to 1 5 per cent for polymeric plasticisers. In addition, the duty rates for certain polyester polyols and additional products of polyester polyols with isocyanates would be increased from free to 20 per cent. Polyester polyols of the alkyd type would continue to be dutiable at 30 per cent.

Proposals No. 1 4 contain tariff changes which give effect to new assistance arrangements for carpets. The changes operate from 18 August 198C and follow the decision of the Government on the report by the Industries Assistance Commission on textiles, clothing and footwear. The Commission found the carpet industry to be a relatively efficient section of Australia's manufacturing industry and recommended, in general and from 1 January 1982, duties of 20 per cent together with duty free imports of carpet yarns and abolition of the Canadian preference margin. It considered these recommendations should reduce the carpet industry's present disadvantages, provide reasonable protection, and ensure resources are not lost to less efficient high cost activities. For trade relations reasons the Government has decided to maintain a preference margin for Canada of 10 percentage points. It has decided that duty rates of 40 per cent general and 30 per cent for Canada will apply from 1 January 1982. As the Government has decided that reductions in duties on carpet yarns will not take place until 1 January 1982 additional interim assistance of 10 percentage points has been given to the industry until that date.

Proposals No. 15, which operates from tomorrow, implements the Government's decision on recommendations made by the Industries Assistance Commission in Part B of its report on chemical products. The decision on Part A of this report was announced in August 1979. With few exceptions the Government has accepted the Commission's recommendations that the goods under reference be dutiable at rates of duty ranging from minimum rates to 30 per cent. Products under reference had been dutiable at rates of up to 37.5 per cent. Goods covered by this report include flavours and fragrances, propyl acetate, ethyl formate and related goods, pure water, lubricating preparations, artificial waxes, polishes, refractory cements, metal pickling preparations, laboratory preparations and gum bases. The Government has not accepted the Commission's recommendations in respect of menthol, citronella, ethyl formate and related products, or casein and casein products.

The Commission recommended that menthol be dutiable at 1 0 per cent. However, in view of the strong import competition facing the industry at present, the Government has decided that for two years the duty rate should be 20 per cent when it will phase to the recommended level of 10 per cent. Because of Australia's international trade commitments citronella will continue to be admitted free of duty and not at the recommended rate of 1 0 per cent. Ethyl formate and related products will be dutiable at 25 per cent. The Government has varied the Commission's recommendation of minimum rates to align with the industry rate of 25 per cent applying to most other acetyl products. This rate was introduced following the Government's decision of May 1979 on the Commission's report on acetyl products.

Because of the inter-relationship between various manufactured dairy products it has been decided that the question of assistance to producers of casein and casein products should be examined within the broader context of a future review, by the Commission, of dairy industry marketing arrangements. The Government considers that implementation of the Commission's recommendations will at least maintain the level of employment and activity in the industries covered by the report at the time of the reference.

Proposals No. 15 also contain administrative changes. These changes which relate to surfaceactive agents, calibrated drainage bags, dental hand pieces and flexible discettes for computers are necessary to ensure that levels of assistance agreed to by the Government are maintained. A comprehensive summary setting out the nature of the duty changes has been prepared and is being circulated to honourable members. I commend the Proposals to the House.

Debate (on motion by Mr Hurford) adjourned.

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