Agriculture Victoria is currently reviewing the duty amount charged on the sale of sheep and goats. The aim of the review is to ensure that the duty is set at an appropriate level to deliver and support programs that are of most benefit to the industry.
The purpose of this consultation is to provide information to participants in the sheep and goat meat, wool and relevant dairy industries and invite feedback on options for changes to the duty.
Update - November 2020
The rate of duty on the sale of sheep and goats and their carcases is changing, following community and industry consultation.
Since 1999, the rate of duty has been 12 cents for each sheep or goat and each carcase of sheep or goat sold.
The rate is set by the Duties Act 2000. Pending amendment to the Duties Act 2000, the duty will be –
- 1 January 2021 (provisional) – 19 cents per head
- 1 January 2022 – 27 cents per head
- 1 January 2023 – 35 cents per head
The additional income into the Sheep and Goat Compensation Fund (SGCF) will allow for more investment in programs and projects that benefit those industries, including the potential ongoing subsidisation of sheep and goat electronic tags for Victorian producers.The duty will be raised incrementally so farmers have time to prepare for increased costs.
Producers selling sheep and goats in Victoria currently pay a duty set at 12 cents per head. Monies collected for the duty are paid into the Sheep and Goat Compensation Fund (SGCF), which is established under the Livestock Disease Control Act 1994 (LDC Act).
The SGCF is overseen by the Sheep and Goat Compensation Advisory Committee (SGCAC) comprising representatives from industry. Expenditure requires approval from the Minister for Agriculture.
The purposes of the Sheep and Goat Compensation Fund (SGCF) are to provide a means -
- for compensation to be paid to producers for sheep and goats affected by a declared (under the LDC Act) endemic disease that are covered by coordinated disease control programs. There currently are no declared endemic diseases for which compensation can be paid, but it remains as an important tool should there be a future need. For example, the fund previously provided compensation for losses associated with ovine Johne’s disease. Compensation in the event of a declared exotic disease would be paid from a separate fund.
- for financial support to programs and projects that benefit the sheep and goat industries. The SGCAC considers proposals for funding and then makes recommendations to the Minister regarding suitable projects. Recent examples include:
- supporting the Victorian Farmers Federation’s Livestock Health and Biosecurity Victoria extension program to raise awareness of biosecurity and improve practices of peri-urban livestock producers.
- supporting research into the development of a rapid field test for anthrax infected sheep and methods to destroy anthrax spores in the environment.
- improving disease surveillance capability, including a project to provide feedback to producers about disease detected at abattoirs.
- educating producers about biosecurity, welfare and traceability, for example through the publication of the Sheep Notes newsletter and VFF livestock extension activities.
The attached Sheep and Goat Duty Amount Review Summary document includes a figure representing the SGCF, its income and its expenditure.
The duty amount paid on the sale of sheep and goats is set by the Duties Act 2000 and has remained at 12 cents per head since 1999. The cost of providing funding to initiatives that benefit the sheep and goat industries has on the contrary continued to increase. Had indexation been applied to the duty it would be approximately 19 cents per head in 2019.
The SGFC provides an average of $1.25 million per annum for programs and projects, currently the fund is oversubscribed. An increase in revenue would provide for a greater range of projects proposed by industry participants, researchers and others.
Victoria leads Australia in sheep and goat traceability, through the roll-out of individual electronic identification (EID) of sheep and goats. The transition to EID has been supported through government grants and tag subsidies to participants across the supply chain, including saleyards, processors and producers to install equipment and software.
An effective and efficient EID traceability system greatly reduces costs to participants across the supply chain. Non-EID forms of traceability are more expensive to implement, less accurate and inefficient. EID also provides producers with the opportunity to realise production benefits through on-farm management of individual sheep and goats, and through accurate and timely market feedback on sheep and goats sold and processed.
The financial costs of subsidising EID tags for producers is transferring to an industry responsibility. The SGCAC recognises the importance of EID and that the compensation fund is a practical source of industry funding to support continuation of the tag subsidy into the future, if a duty increase to facilitate this is supported by industry through this consultation process.
This consultation seeks feedback on whether or not to increase the duty as set out in Figure 1 below.
1. Should the duty amount be increased to pay for more programs and projects?
- If agreed, additional funds could be allocated to substantially more programs and projects that benefit industry. Proposals for funding would continue to be considered annually by the SGCAC.
- If not agreed, the annual funding available for these programs and projects would remain at current levels.
2. Should the duty amount be increased to continue to subsidise the EID program beyond 2021?
- If agreed, the cost to producers of EID tags would remain similar to now due to a subsidy applied to EID tag prices. EID tag prices have been subsidised to facilitate the implementation of EID and have risen as the subsidies have been progressively wound back. It is expected that in 2021 the cheapest EID tags will be available to producers for approximately 76 cents each.
- If not agreed, EID tag prices would increase subject to market supply and demand. It is not possible to provide an indication of how much due to the nature of commercial drivers.
The options provided allow for a combination of answers with either a staggered increase or a single increase, or no increase. Any increase is not proposed to commence before 1 July 2020.
For additional details on these options, please consult the Sheep and Goat Duty Review Summary document. This document provides a summary, details of the duty increase for each option, and additional background information.
What will we do with your information?
The Department of Jobs, Precincts and Regions is committed to protecting personal information provided by you in accordance with the principles of the Victorian privacy laws.
The information you provide will be used to inform the Agriculture Victoria's review of the sheep and goat duty amount.
Personal information that is collected by the Department will be used by, and disclosed to, departmental employees whose duties require them to use it. Such employees are required to protect and handle your personal information in accordance with the Privacy and Data Protection Act 2014 (Vic) and any other applicable legislation regulating the collection, use, disclosure, storage and destruction of personal information.
The information you provide will be summarised and collated with other submissions for the Minister for Agriculture and other Ministers and departments to inform the review.
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