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No change to wool levy.

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AFFA02/118WT 28 May 2002

No change to wool levy

A review of Australia’s wool levy has found that there are inadequate grounds, and little industry support, for extending the levy to cover non-shorn material such as wool-on skins or fellmongered wool, the Federal Agriculture Minister, Warren Truss, announced today.

The levy, along with matching contributions from the Commonwealth, helps fund the wool industry’s research and development activities.

Mr Truss said the review, which was undertaken by the Commonwealth Department of Agriculture, Fisheries and Forestry, consulted widely with industry stakeholders.

“Although fellmongered wool enters the traditional wool pipeline, the review concluded that, as it is a by-product of the slaughtering process, it is much more closely aligned to the meat-processing sector, for which a levy is already paid,” Mr Truss said.

“There is clearly little support from the fellmongering and wool-on skins sectors for the levy being extended to include their products. The net benefits to the overall industry are also difficult to demonstrate.”

Mr Truss said the review did, however, recommend that the levy could be extended to cover biologically harvested wool, and dead and plucked wool.

“The review found that biologically harvested wool, and dead and plucked wool, are simply other ways of removing the fleece from sheep. Extending the levy to include these wool types would, however, only contribute a small amount to the levy.

“For example, information collected during the review process suggests that this would amount to an increase of only around $90,000 for the 2001-2002 financial year, with little significant growth expected for some years to come.

“As the expected revenue gain from using biologically harvested wool, and dead and plucked wool, is so modest, I have decided not to change the levy coverage.

“However, if the use of biologically harvested wool increases to the extent that a significant proportion of the Australian clip is being harvested in this way, I am prepared to reconsider the issue at a later stage.

“I would like to thank the many individuals and organisations who took the time to make submissions to the review, and help ensure it reflected the interests and concerns of all stakeholders in the important industry.”

Further inquiries: Mr Truss's office, Andrew Hall 0419 996 766

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Last updated 28 May 2002

URL: Commonwealth of Australia 2000