Rudd Govt to remove milk tax in two weeks
Consumers will benefit from modest savings on the price of fresh milk when an eight-year milk tax is lifted on 22 February 2009.
The Rudd Government announced last year it would abolish the 11 cents a litre levy, which was established by the former government in 2000 to fund an industry deregulation adjustment package.
Minister for Agriculture, Fisheries and Forestry Tony Burke wrote to major retailers and retail associations in January reminding them that the Government expected costs savings from the removal of the tax to be passed on to consumers.
He has now welcomed announcements that key retailers would pass the tax cut on to consumers of fresh milk, including:
* Aldi (announced an immediate reduction of 11 cents per litre in the price of milk)
* Coles (plans to reduce the price of all fresh milk by 11 cents per litre from Monday 23 February, but is already reducing the price of its house brand milk)
* Woolworths (plans to reduce the price of all fresh milk by 11 cents per litre from Monday 23 February, but has already reduced the price of a house brand milk in every state and territory)
“This is a responsible decision by major retailers which will save families money at the checkout, at a time when every cent counts,” Mr Burke said.
“We expect other retailers to pass on the modest savings to consumers.
“Any complaint or suggestion of anti-competitive conduct over the removal of the levy will be dealt with by the Australian Competition and Consumer Commission.
“The Government recognises the dairy industry is under pressure with some processors dramatically slashing the farm-gate price of milk.
“We will continue to look at what potential forms of assistance may be available for dairy farmers.”
The levy funded a number of measures to help dairy farmers adjust to the removal of state and Commonwealth government price support measures.
It is collected by dairy processing companies and appropriated into a trust fund, which is administered according to statutory obligations and a statutory funding agreement between Dairy Australia Ltd and the Commonwealth.
According to statutory requirements, it was to be abolished once the trust fund was brought into balance.
Add comment February 11th, 2009