Primary Industries (Customs) Charges Act 2024

Understanding the operation of the Act requires unpacking several highly elastic statutory definitions and structural concepts.

The first key concept is "produce of a primary industry", which is defined under section 4 through a non-exhaustive list of activities. This list covers traditional sectors such as agriculture, cultivation of land, horticulture, viticulture, forest operations (defined as the growing, harvesting, or processing of wood), fishing (the catching, capturing, or harvesting of aquatic vertebrates or invertebrates), aquaculture, and commercial animal maintenance. Crucially, the definition also embraces modern, highly industrialised agricultural systems, explicitly naming soilless growing systems (including hydroponics, aeroponics, and aquaponics) and controlled environment cropping (such as vertical farming, indoor farming, and protected cropping). By including "any other primary industry activity" under paragraph (m), the Parliament has granted the executive an exceptionally broad tax base that can expand to cover emerging agricultural technologies without requiring legislative amendments.

The biological targets of the Act are divided into four categories under section 4:

• Animals: Any member of the animal kingdom, alive or dead, excluding humans.
• Plants: Any member of the plant kingdom, alive or dead.
• Fungi: Any member of the fungi kingdom, alive or dead, explicitly including yeasts, mushrooms, and truffles.
• Algae: Macroalgae, microalgae, or cyanobacteria, explicitly including seaweeds.

Crucially, the corresponding definition of a "product" (for example, an "algal product" or "fungus product") includes not only the organism or any part of it, but also "anything produced by" the organism, and "anything wholly or principally produced from, or wholly or principally derived from" it. This derivative drafting means that highly processed import inputs, such as refined algal oils, yeast extracts, or plant-derived biochemicals, can be captured by regulations made under the Act.

The second core concept is the statutory restriction on the purpose of these charges. Under section 7(3), before regulations can be made to impose a primary industry product charge, the Minister must be satisfied that the imposition will result in expenditure on specific, industry-linked activities. These include marketing, advertising, or promotion; research and development; biosecurity activities and plant/animal health; biosecurity responses; the National Residue Survey; or other activities prescribed by regulation for the benefit of the industry. For input-related charges under section 10(2), the Minister's satisfaction is limited to expenditure on biosecurity responses or activities promoting the health of plants, animals, fungi, or algae.

The final major concept concerns the consultative infrastructure established under section 20. The Act distinguishes between "nominated industry representative bodies" and "nominated polling bodies," which are determined by the Minister via legislative instrument. These bodies act as statutory intermediaries, representing industry interests during the rate-setting process and, in the case of polling bodies, conducting mandatory polls of industry participants before making rate recommendations to the Minister.

The economic and compliance impacts of the Act fall on several distinct groups across the agricultural, import, and logistics sectors, despite none of these groups being named in the primary text. Under section 17, the specific "charge payer" for any given charge is to be determined entirely by the regulations.

First, the Act directly affects importers and customs brokers. Because the charges are constitutionally confined to duties of customs, the legal liability must be triggered by importation. Importers of raw agricultural products, live animals, plants, yeasts, or seaweeds will bear the direct administrative burden of calculating and paying these charges at the border.

Second, the Act affects manufacturers, distributors, and importers of agricultural inputs. Part 3 authorises charges on goods consumed by, or used in the treatment or maintenance of, biological organisms. This captures veterinary chemicals, animal feeds, fertilisers, soil conditioners, fungicides, and crop protection products. Importers of these manufacturing inputs will face increased landed costs, which they will likely seek to pass down the supply chain to primary producers, thereby raising overall domestic production costs.

Third, the Act establishes a unique compliance regime for non-corporate business structures, which are common in the Australian agricultural sector. Under sections 21, 22, and 23, the Act strips away some of the traditional liability protections associated with partnerships, trusts, and unincorporated associations:

• Partnerships (s 21): The Act applies to a partnership as if it were a separate legal person, but explicitly imposes any statutory obligation on each individual partner. While any partner can discharge the obligation, every partner remains personally exposed to compliance failures. Continuity of the partnership's liability is maintained despite changes in its composition.
• Trusts (s 22): For trusts with a single trustee, obligations are civilly imposed on that trustee. For trusts with multiple trustees, obligations are imposed on each trustee individually, creating joint and several liability.
• Unincorporated Bodies or Associations (s 23): The Act imposes all obligations directly onto each member of the association's committee of management.

Finally, the Act affects state and territory government departments that engage in commercial primary production, forestry, or aquaculture. Although section 18 prevents the Commonwealth from imposing a tax on "property of any kind belonging to a State" (relying on the constitutional protection under section 114), state entities operating commercial enterprises that import biological products or inputs will still need to navigate the complex boundary of what constitutes State "property" versus commercial transactions subject to customs duties.

Because the Primary Industries (Customs) Charges Act 2024 is an enabling statute, it does not impose immediate, direct operational duties on private citizens. Instead, those duties are created when regulations are made under section 24. However, the Act establishes a strict framework of statutory duties for the Minister and corresponding procedural rights for industry bodies during the creation of those regulations.

The Minister is bound by a statutory duty of satisfaction under sections 7(3) and 10(2). The Minister cannot recommend that the Governor-General make regulations imposing a charge unless the Minister is genuinely satisfied that the resulting revenue will be directed toward the specified industry, research, or biosecurity purposes.

For industry participants, their primary legal rights are expressed through the consultation mechanisms in section 20 and section 24(2):

• Nominated Industry Representative Bodies: Under section 20(2), if the Minister has designated a body as a representative body for a specific charge, the Minister must consult with that body before making or amending regulations setting the rate. The body has a statutory right to make recommendations to the Minister regarding the rate. However, under section 20(4), the representative body is itself under a duty to consult with any other bodies specified by the Minister in the designating instrument before making its recommendation.
• Nominated Polling Bodies: Under section 20(7), if a polling body is designated for a charge, the Minister must consult with it. The polling body has a statutory duty under section 20(9) to ensure a poll is conducted in accordance with requirements specified by the Minister before making a recommendation. The polling body's recommendation to the Minister must strictly accord with the results of that poll.

The Minister is also subject to a strict duty under section 24(2)(a)(ii) and (b)(ii) regarding the maximum rate of a charge. If a nominated representative body or polling body makes a recommendation regarding a charge rate, the Minister must ensure that the rate set in the regulations does not exceed the recommended rate. If no body is nominated, the Minister is under a duty under section 24(2)(c) to ensure that "appropriate consultation" is undertaken with persons and organisations involved in the target industry, and that their recommendations are considered.

A striking feature of the Primary Industries (Customs) Charges Act 2024 is the total absence of civil or criminal penalty provisions, enforcement mechanisms, audit powers, or interest charges within its text. This silence is not an oversight, but a deliberate consequence of Australian constitutional law.

Under section 55 of the Constitution, laws imposing taxation must deal only with the imposition of taxation, and any provision therein dealing with any other matter is of no effect. To ensure the constitutional validity of the customs charges, Parliament separated the imposition of the tax from its collection and enforcement. The Primary Industries (Customs) Charges Act 2024 is strictly limited to the legal imposition of the charges.

Consequently, the entire enforcement apparatus (including penalties for non-payment, late payment fees, record-keeping requirements, and administrative powers to audit importers) is housed in separate, companion legislation, specifically primary collection acts and their associated regulations.

While section 24(1) of this Act authorises the Governor-General to make regulations "necessary or convenient to be prescribed for carrying out or giving effect to this Act," this power cannot be used to bypass section 55 of the Constitution by inserting coercive penal administrative provisions directly under this Act's regulatory umbrella. Any enforcement action, civil penalty proceeding, or criminal prosecution relating to a failure to pay charges imposed under this Act must be brought under the authority of those separate collection statutes, which contain the necessary machinery to enforce the Commonwealth's taxation power.

The Act sits within a dense matrix of constitutional, taxation, and administrative laws, requiring careful systemic reconciliation.

First, its primary constitutional interaction is with section 55 and section 114 of the Constitution. The draftspersons have carefully insulated the Act from constitutional invalidity under section 114 (which prohibits the Commonwealth from taxing State property) by inserting section 18. Section 18(1) explicitly states that the Act does not authorise the imposition of a tax on property of any kind belonging to a State, and section 18(3) extends this constitutional protection to the property of the Australian Capital Territory and the Northern Territory.

Second, the Act interacts directly with the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act). Section 19 of the Act explicitly overrides section 177-12 of the GST Act. It mandates that any reference in the regulations to the price of a product or goods (such as the sale price, market price, or amount paid) must be taken not to include the net GST included in that price. This prevents the compounding taxation effect of calculating customs charges on top of the GST component of imported goods. It requires importers and customs authorities to maintain dual-track accounting records to isolate the pre-GST value of goods when calculating charge liabilities.

Third, the Act modifies the operation of the Legislation Act 2003. Typically, section 14(2) of the Legislation Act 2003 prevents delegated legislation from incorporating external instruments or writing "as in force or existing from time to time" to prevent sub-delegation of legislative power without Parliamentary oversight. However, section 24(5) of this Act explicitly overrides this restriction, permitting the regulations to apply, adopt, or incorporate any matter contained in an external instrument or writing as in force from time to time. This allows the regulations to dynamically link to external industrial standards, biosecurity manuals, or international classification systems, meaning a change in those external documents automatically alters the domestic tax landscape without parliamentary intervention.

Finally, the Act interacts with the broader administrative law framework. While section 24(2) outlines consultation requirements, section 24(3) explicitly declares that a failure to undertake the statutory consultation does not affect the validity or enforceability of the regulations. This effectively insulates the regulations from judicial review challenges based on procedural failures during the consultation phase, narrowing the administrative law remedies available to affected industry participants.

The Primary Industries (Customs) Charges Act 2024 (No. 55, 2024) is a modern piece of legislation. It was passed by both Houses of the federal Parliament and received Royal Assent on 9 July 2024. The Act officially commenced on 1 January 2025.

Because of its recent entry into force, the primary text of the Act has not undergone any subsequent legislative amendments. It was introduced as part of a wider legislative package designed to consolidate, modernise, and simplify Australia’s highly fragmented agricultural levy and charge systems, which were previously scattered across dozens of historical commodity-specific statutes.

As a result, there are no historical amendment tables, amending acts, or transitional provisions affecting the text of No. 55, 2024. Researchers and practitioners must monitor future amending bills, particularly those arising from reviews of the agricultural biosecurity funding model, which may alter the scope of the biological definitions in section 4 or the administrative consultation mechanisms in section 20.

As of its commencement date of 1 January 2025, there is no reported litigation or judicial consideration directly interpreting the provisions of the Primary Industries (Customs) Charges Act 2024.

However, because the Act is constitutionally anchored to the Commonwealth’s customs power, any future litigation is highly likely to mirror historical constitutional challenges regarding the boundaries of section 55 of the Constitution. In particular, High Court jurisprudence on what constitutes a "duty of customs" will dictate the outer limits of the regulations made under this Act.

Under established constitutional principles, if a regulation made under Part 2 or Part 3 of the Act attempts to impose a charge on goods that have already entered domestic circulation, or structures the charge in a way that characterises it as an excise rather than a tax on importation, the regulation would be vulnerable to a constitutional challenge. Similarly, if the Minister attempts to impose a charge that does not possess a sufficient territorial or importation nexus, litigators will look to challenge the validity of the underlying regulations, using the strict constitutional limitations explicitly preserved in sections 7(4) and 10(3).

For legal advisors, compliance managers, and trade consultants, several high-risk elements or "gotchas" in the Act require careful management:

1. The Consultation "Paper Tiger" (s 24(3)): While the Act contains elaborate consultation mandates in section 20 and section 24(2), section 24(3) strips away any legal consequence for non-compliance. If a Minister completely ignores a nominated industry representative body, fails to conduct required consultations, or fails to await a poll result before recommending regulations, the resulting regulations remain fully valid and enforceable. Industry bodies cannot use a failure to consult to seek an injunction or have the tax regulations declared void.
2. The Dynamic Incorporation Trap (s 24(5)): Because the regulations can adopt external documents "as in force from time to time," the legal definitions of taxable goods, biosecurity standards, or exemption thresholds can change overnight without notice or legislative process. Importers cannot rely on static printouts of the regulations; they must monitor the live versions of any external industry or international documents incorporated by reference.
3. The Derivative Product Catch-All (s 4): The definitions of animal, plant, fungus, and algal products extend to anything "wholly or principally produced from, or wholly or principally derived from" those organisms. This creates extreme classification risk. For example, a processed food importer might import a product containing a plant-derived stabilizer or a yeast-derived flavouring agent. If the regulations impose a charge on those plant or fungal products, the importer may find their highly processed finished goods captured by the customs charge because of their chemical derivation.
4. Absolute Personal Liability for Non-Corporate Structures (ss 21-23): Members of committees of management for unincorporated agricultural associations, partners in farming partnerships, and individual trustees are directly exposed to the compliance obligations of the Act. The Act bypasses the entity level and places the compliance burden squarely on the shoulders of these individuals, exposing their personal assets to liability if companion collection acts are breached.
5. The Pre-GST Pricing Accounting Burden (s 19): Because net GST must be excluded from any price-based calculations under the regulations, standard commercial invoices that display GST-inclusive amounts cannot be used directly to calculate the customs charge. Customs brokers and compliance software must be configured to strip out the net GST component before applying the charge rate, creating an ongoing administrative overhead.

To ensure compliance with the regulatory regime authorised by the Primary Industries (Customs) Charges Act 2024, organisations should adopt a structured, five-step compliance program:

[Step 1: Monitor Regulations & Instruments]
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[Step 2: Biological Supply Chain Mapping]
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[Step 3: Implement Dual-Track Accounting]
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[Step 4: Restructure Entity Deeds & Indemnities]
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[Step 5: Establish Lobbying & Representative Pipelines]

Step 1: Monitor Regulations and Legislative Instruments

Because this Act is an enabling statute, compliance cannot be achieved by reading the Act alone. Compliance officers must establish an active monitoring pipeline for:

• Regulations made under section 24, which will specify the actual rates (Part 4), exemptions (s 9 and s 12), and the designated charge payer (s 17).
• Legislative instruments made by the Minister under section 20 determining "nominated industry representative bodies" and "nominated polling bodies."

Step 2: Biological Supply Chain Mapping

Review all imported product lines against the expansive biological definitions in section 4. Importers must classify their goods not just by standard customs tariff codes, but by biological origin:

• Identify if any imported materials contain animal, plant, fungus, or algal derivatives.
• Determine whether the imported goods are "wholly or principally produced from" or "derived from" these categories.
• Audit all imported agricultural inputs (such as feeds, chemical treatments, or growing media) to determine if they are of a kind "consumed by, or used in the maintenance or treatment of" animals, plants, fungi, or algae under section 10.

Step 3: Implement Dual-Track Accounting for GST

Configure enterprise resource planning (ERP) systems and customs clearance software to comply with section 19:

• Ensure that the customs value, sale price, or transaction value used to calculate any percentage-based charge rate is calculated on a pre-GST basis.
• Isolate and subtract the net GST (within the meaning of the A New Tax System (Goods and Services Tax) Act 1999) from the calculation base to avoid overpaying the customs charge or violating calculation regulations.

Step 4: Restructure Partnership, Trust, and Association Deeds

In light of the pass-through personal liability established under sections 21, 22, and 23:

• Partnerships: Update partnership agreements to insert clear indemnity clauses, ensuring that if an individual partner is called upon to discharge a customs charge obligation, they are fully indemnified out of the partnership’s assets.
• Trusts: Trustees must review trust deeds to ensure they have an absolute right of exoneration and indemnity out of the trust fund for any liabilities incurred under section 22.
• Unincorporated Associations: Committees of management must secure directors' and officers' (D&O) liability insurance that explicitly covers statutory liabilities and administrative compliance costs arising from customs and agricultural levies.

Step 5: Establish Lobbying and Representative Pipelines

Since the Minister must consult with nominated bodies under section 20 before setting or amending rates:

• Identify the nominated representative body or polling body designated for your specific commodity or input sector.
• Establish formal communication channels with these bodies to ensure your business’s economic interests and cost-benefit concerns are represented during the statutory consultation processes.
• For goods subject to polling bodies, ensure your organisation is registered on the relevant voter rolls to participate in the mandatory polls conducted under section 20(9).