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Tuesday, 29 May 1984
Page: 2096

(Question No. 731)

Senator Peter Rae asked the Minister for Industry and Commerce, upon notice, on 27 March 1984:

Is the duty on most non-leather footwear now at a level of 141 per cent; if so, does the Minister for Industry and Commerce regard this as acceptable or does he propose to take any, and if so, what action in relation to it.

Senator Button —The answer to the honourable senator's question is as follows:

Under the textiles, clothing and footwear assistance plan introduced in 1982 local footwear production is assisted against imports by duties and tariff quotas. A proportion of quota is allocated annually through a tender system using a 'Dutch auction' type approach. This means that successful tenderers pay a premium rate of customs duty equal to the tender bid which clears the quota pool. This is additional to the customs duty of 40 per cent which applies to base quota.

For 1984 the tender bid which cleared the quota pool for non-leather footwear was 101 per cent. Therefore footwear imported in 1984 using non-leather footwear tender quota is subject to 141 per cent duty. However, this duty rate only applies to non-leather footwear with a customs value of $1 or more but less than $9.50 which represents about 20 per cent of quota for non-leather footwear. The remaining footwear in this category in 1984 is imported using base quota and is subject to 40 per cent duty. Non-leather footwear with a customs value less than $1 is not subject to quota.

Tender premiums vary from year to year and are a reflection of the market value of quota to tenderers. It is expected that as more quota is made available for tender through the life of the assistance plan the premiums tenderers are willing to pay will decline. However, it should be borne in mind that tender premiums reflect the commercial judgement of tenderers and it is not government policy to influence that judgement.