Meat Processors Will Pass On Carbon Tax

AUSTRALIA - Federal Member of the Australian Parliament for Wannon, Dan Tehan is urging the Independents to explain why they are supporting a tax that threatens beef and sheep farmers’ livelihoods and meat processors’ jobs.

25 July 2011

2 minute read

Oceania

Prime Minister Julia Gillard is proposingthat carbon dioxide emissions should be taxed at A$23 per tonne from 2012.

The economic reform will cover some 500 companies and in 2015, a market-based trading scheme will be introduced.

Mr Tehan said that the Carbon Tax announcement, which excludes agricultural fuel initially, ignores the major impacts on the agricultural processing industry.

“Meat processors such as Midfield Meats in our local region will have to deal with increased power bills from the Carbon Tax, which will ultimately come off the price paid to farmers," he said.

“The Carbon Tax will cost the most efficient meat processors in Australia another 24 to 30 cents per sheep.

“An average abattoir processing 3000 cattle a week will see its electricity bill increased by a quarter of a million dollars in the first year. This is without considering other cost increases and the impacts of gas which will also rise by nine per cent."

Mr Tehan added "The meat industry operates on slim profit margins. It will have no choice but to pass these costs onto producers, as they compete in world markets against international businesses that do not face these extra costs.

“And that is all before the massive increase in transport costs which will come in after the next election.

“At the same time the Government is imposing these extra costs it is also removing its 40% rebate on the Export Certification Reform, without delivering the cost efficiencies it promised two years ago.

“The government has saved $30 million from the retrenched meat inspectors but total industry inspection costs have risen by between 44 per cent to over 110 per cent once full cost recovery is applied – where are the efficiencies? These are more costs that industry will have to pass on to livestock producers.

“On top of these processing costs farmers also face rising costs from increased input prices, such as electricity, fertiliser and chemicals. Income Tax increases of between 10 and 27 per cent, in the lower and medium brackets, will also hit farmers who are finally making some income after years of drought.”

“Gillard’s inept government has come up with a tax which is oblivious to agricultural realities. Together with the Greens and Independents they will paralyse the country, contracting our livestock industries and cutting jobs from the processing sector,” Mr Tehan said.