Primary Industries (Services) Levies Act 2024

The Primary Industries (Services) Levies Act 2024 (No. 57, 2024) establishes a national legislative framework that authorises the executive government, via regulations, to impose levies on commercial services that facilitate the production of primary industry products. Unlike traditional primary industry levies, which typically target the physical sale, slaughter, or export of raw agricultural commodities, this Act focuses on the service layer of the agricultural value chain.

Mechanically, the Act functions as an "empty vessel" statute. It does not directly impose any specific levy, establish tax rates, or name the precise services subject to taxation. Instead, it delegates these powers to subordinate legislation. Under section 7(1), the regulations may specify a service and impose a levy on its provision, provided that the service involves the use or application of a specified primary industry product and is provided on a commercial basis.

Before the Governor-General can make these regulations, the Minister must be satisfied that the levy's revenue will be directed toward one or more of the statutory purposes enumerated in section 7(3). These purposes include funding marketing, advertising, or promotion; research and development (R&D) activities; biosecurity activities and biosecurity responses; activities relating to the National Residue Survey; or any other activity prescribed by regulations that benefits a primary industry.

By taxing the service inputs to production, the Act creates a mechanism to capture revenue from modern, service-integrated agricultural operations. From an economic perspective, while the official rationale focuses on collective investment in R&D, biosecurity, and industry promotion, the mechanism shifts the legal compliance burden onto service providers. The ultimate economic incidence, however, is likely to be passed downstream to primary producers through adjusted service pricing.

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Commonwealth Coat of Arms of Australia

Primary Industries (Services) Levies Act 2024

No. 57, 2024

An Act relating to the imposition of primary industries levies that are neither duties of customs nor duties of excise, and for related purposes

Contents

Part 1—Preliminary

1 Short title

2 Commencement

3 Simplified outline of this Act

4 Definitions

5 Crown to be bound

6 Application of this Act in external Territories

Part 2—Levy on the provision of services that facilitate production of products that are produce of a primary industry

7 Imposition of levy

8 Imposition of 2 or more levies

9 Exemptions from levy

Part 3—Rate of levy

10 Rate of levy

11 Components of levy

12 Flexibility in relation to rates of levy

13 Nil or zero rates

Part 4—Levy payer

14 Levy payer

Part 5—Other matters

15 Act does not impose levy on property of a State

16 Net GST not included in price of service or amount paid for service

17 Nominated industry representative bodies and nominated polling bodies

18 Treatment of partnerships

19 Treatment of trusts

20 Treatment of unincorporated bodies or associations

21 Making of regulations

Commonwealth Coat of Arms of Australia

Primary Industries (Services) Levies Act 2024

No. 57, 2024

An Act relating to the imposition of primary industries levies that are neither duties of customs nor duties of excise, and for related purposes

[Assented to 9 July 2024]

The Parliament of Australia enacts:

Part 1—Preliminary

1 Short title

This Act is the Primary Industries (Services) Levies Act 2024.

2 Commencement

(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

Commencement information
Column 1 Column 2 Column 3
Provisions Commencement Date/Details
1. The whole of this Act 1 January 2025. 1 January 2025

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

3 Simplified outline of this Act

This Act authorises the regulations to impose a levy on the provision of a specified service that facilitates the production of a specified product that is produce of a primary industry.

The service:

(a) must involve the use or application of a product that is produce of a primary industry; and

(b) must be provided on a commercial basis.

In addition to imposing a particular levy, the regulations are to set out:

(a) any exemptions from the levy; and

(b) the rate of the levy; and

4 Definitions

In this Act:

algae means macroalgae, microalgae or cyanobacteria, and includes seaweeds.

algal product means:

(a) an alga; or

(b) any part of an alga; or

(d) anything wholly or principally produced from, or wholly or principally derived from, an alga.

animal means any member, alive or dead, of the animal kingdom (other than a human being).

animal product means:

(a) an animal; or

(b) any part of an animal; or

(d) anything wholly or principally produced from, or wholly or principally derived from, an animal.

aquaculture means propagating, rearing, keeping or breeding aquatic vertebrates or aquatic invertebrates.

fishing means the catching, capturing or harvesting of aquatic vertebrates or aquatic invertebrates.

forest operations means the growing, harvesting or processing of wood.

fungus means any member, alive or dead, of the fungi kingdom, and includes yeasts, mushrooms and truffles.

fungus product means:

(a) a fungus; or

(b) any part of a fungus; or

(d) anything wholly or principally produced from, or wholly or principally derived from, a fungus.

levy means a levy imposed by regulations made for the purposes of Part 2.

nominated industry representative body means a body determined to be a nominated industry representative body by an instrument in force under subsection 17(1).

nominated polling body means a body determined to be a nominated polling body by an instrument in force under subsection 17(6).

plant means any member, alive or dead, of the plant kingdom.

plant product means:

(a) a plant; or

(b) any part of a plant; or

(d) anything wholly or principally produced from, or wholly or principally derived from, a plant.

produce of a primary industry means products that result from any of the following:

(a) agriculture or the cultivation of land;

(b) the maintenance of animals for commercial purposes;

(d) controlled environment cropping, including vertical farming, indoor farming and protected cropping;

(e) forest operations;

(f) fishing;

(g) aquaculture;

(h) hunting or trapping;

(i) picking or harvesting from the wild;

(j) horticulture;

(k) viticulture;

(l) the cultivation of fungi or algae;

(m) any other primary industry activity.

product means an animal product, a plant product, a fungus product or an algal product (whether or not any operations have been performed in relation to the product).

property of any kind belonging to a State: see subsection 15(2).

Secretary means the Secretary of the Department.

5 Crown to be bound

This Act binds the Crown in right of each of the States, of the Australian Capital Territory and of the Northern Territory. However, it does not bind the Crown in right of the Commonwealth.

6 Application of this Act in external Territories

(1) Subject to subsection (2), this Act and the regulations do not extend to the external Territories.

(2) The regulations may extend this Act, and any provisions of the regulations, to an external Territory that is prescribed by the regulations.

Part 2—Levy on the provision of services that facilitate production of products that are produce of a primary industry

7 Imposition of levy

(1) The regulations may impose a levy on the provision of a specified service that facilitates the production of a specified product that is produce of a primary industry.

Note: A service may be specified by name, by inclusion in a specified class, or in any other way.

(2) Any regulations made for the purposes of subsection (1) must require the service to be one:

(a) that involves the use or application of a specified product that is produce of a primary industry; and

(b) that is provided on a commercial basis.

Minister to be satisfied of matters

(3) Before the Governor‑General makes regulations for the purposes of subsection (1), the Minister must be satisfied that the imposition of the levy will result in one or more of the following:

(a) expenditure on the marketing, advertising or promotion of products of one or more primary industries;

(b) expenditure on research and development activities for the benefit of one or more primary industries;

(c) expenditure on activities, including biosecurity activities, relating to the promotion or maintenance of the health of plants, animals, fungi or algae;

(d) expenditure on matters relating to a biosecurity response;

(e) expenditure on activities relating to the National Residue Survey;

(f) expenditure:

(i) on any other activity prescribed by the regulations in relation to one or more primary industries; and

(ii) for the benefit of one or more primary industries.

Duty neither a duty of customs nor a duty of excise

(4) This section authorises the imposition of a levy only so far as the levy is neither a duty of customs nor a duty of excise within the meaning of section 55 of the Constitution.

8 Imposition of 2 or more levies

This Part does not prevent the imposition of 2 or more levies, whether in relation to the same service or in relation to different services.

9 Exemptions from levy

The regulations may provide for exemptions from a levy under this Part.

Part 3—Rate of levy

10 Rate of levy

The rate of a levy is worked out in accordance with the regulations.

11 Components of levy

(1) The rate of a levy may be expressed to be equal to:

(a) a single component prescribed by the regulations; or

(b) the sum of such components as are prescribed by the regulations.

(2) Subsection (1) does not limit section 10.

12 Flexibility in relation to rates of levy

(1) Different rates of the same levy may be prescribed by the regulations for different kinds of services.

(2) Subsection (1) does not limit section 10.

(3) Subsection (1) does not limit subsection 33(3A) of the Acts Interpretation Act 1901.

13 Nil or zero rates

The rate of a levy, or a component of the rate of a levy, may be expressed to be:

(a) nil; or

(b) zero; or

(d) 0% of the sale price of a service.

Part 4—Levy payer

14 Levy payer

A levy is payable by the person worked out in accordance with the regulations.

Part 5—Other matters

15 Act does not impose levy on property of a State

(1) This Act does not authorise the imposition of a tax on property of any kind belonging to a State.

(2) Property of any kind belonging to a State has the same meaning as in section 114 of the Constitution.

(3) For the purposes of this section, assume that a reference in section 114 of the Constitution to a State includes a reference to the Australian Capital Territory and the Northern Territory.

16 Net GST not included in price of service or amount paid for service

Despite section 177‑12 of the A New Tax System (Goods and Services Tax) Act 1999, a reference in the regulations to the price of a service (including sale price or market price), or the amount paid for a service, is taken not to include the net GST (within the meaning of that Act) that is included in that price or amount.

17 Nominated industry representative bodies and nominated polling bodies

Nominated industry representative bodies

(1) The Minister may, by legislative instrument:

(a) determine a specified body to be a nominated industry representative body; and

(b) specify one or more levies in relation to that body.

(2) If the Minister does so, before regulations are made setting or amending the rate of such a levy:

(a) if the whole of the rate is specified in relation to the body in accordance with paragraph (3)(a)—the body must be consulted, and may make recommendations to the Minister, about the whole of the rate; or

(b) if a part or parts of the rate are specified in relation to the body in accordance with paragraph (3)(b)—the body must be consulted, and may make recommendations to the Minister, about that part or parts of the rate.

(3) The Minister may, in the instrument under subsection (1):

(a) specify the whole of the rate of a levy in relation to a body for the purposes of paragraph (2)(a); or

(b) specify a part or parts of the rate of a levy in relation to a body for the purposes of paragraph (2)(b).

(4) A nominated industry representative body must, before making a recommendation referred to in paragraph (2)(a) or (b), consult the bodies (if any) specified in relation to the body under subsection (5).

(5) The Minister may, in the instrument under subsection (1), specify bodies in relation to a nominated industry representative body for the purposes of subsection (4).

Nominated polling bodies

(6) The Minister may, by legislative instrument:

(a) determine a specified body to be a nominated polling body; and

(b) specify one or more levies in relation to that body.

(7) If the Minister does so, before regulations are made setting or amending the rate of such a levy:

(a) if the whole of the rate is specified in relation to the body in accordance with paragraph (8)(a)—the body must be consulted, and may make recommendations to the Minister, about the whole of the rate; or

(b) if a part or parts of the rate are specified in relation to the body in accordance with paragraph (8)(b)—the body must be consulted, and may make recommendations to the Minister, about that part or parts of the rate.

(8) The Minister may, in the instrument under subsection (6):

(a) specify the whole of the rate of a levy in relation to a body for the purposes of paragraph (7)(a); or

(b) specify a part or parts of the rate of a levy in relation to a body for the purposes of paragraph (7)(b).

(9) A nominated polling body must, before making a recommendation referred to in paragraph (7)(a) or (b), ensure a poll is conducted in accordance with the requirements specified under subsection (10). The recommendation must be in accordance with the results of the poll.

(10) The Minister may, in the instrument under subsection (6), specify requirements that are for, or in relation to, the conduct of a poll for the purposes of subsection (9).

18 Treatment of partnerships

(1) This Act and the regulations apply to a partnership as if it were a person, but with the changes set out in this section.

(2) An obligation that would otherwise be imposed on the partnership by this Act or the regulations is imposed on each partner instead, but may be discharged by any of the partners.

(3) If this Act or the regulations would otherwise permit something to be done by the partnership, the thing may be done by one or more of the partners on behalf of the partnership.

(4) For the purposes of this Act and the regulations, a change in the composition of a partnership does not affect the continuity of the partnership.

19 Treatment of trusts

(1) This Act and the regulations apply to a trust as if it were a person, but with the changes set out in this section.

Trusts with a single trustee

(2) If the trust has a single trustee:

(a) an obligation that would otherwise be imposed on the trust by this Act or the regulations is imposed on the trustee instead; and

(b) if this Act or the regulations would otherwise permit something to be done by the trust, the thing may be done by the trustee.

Trusts with multiple trustees

(3) If the trust has 2 or more trustees:

(a) an obligation that would otherwise be imposed on the trust by this Act or the regulations is imposed on each trustee instead, but may be discharged by any of the trustees; and

(b) if this Act or the regulations would otherwise permit something to be done by the trust, the thing may be done by one or more of the trustees on behalf of the trust.

20 Treatment of unincorporated bodies or associations

(1) This Act and the regulations apply to an unincorporated body or association as if it were a person, but with the changes set out in this section.

(2) An obligation that would otherwise be imposed on the body or association by this Act or the regulations is imposed on each member of the body’s or association’s committee of management instead, but may be discharged by any of the members.

(3) If this Act or the regulations would otherwise permit something to be done by the body or association, the thing may be done by one or more of the members of the body’s or association’s committee of management on behalf of the body or association.

21 Making of regulations

(1) The Governor‑General may make regulations prescribing matters:

(a) required or permitted by this Act to be prescribed by the regulations; or

(b) necessary or convenient to be prescribed for carrying out or giving effect to this Act.

Consultation—setting or amending the rate of a levy

(2) Before regulations are made setting or amending the rate of a levy, the Minister must be satisfied that in relation to the proposed regulations:

(a) if one or more nominated industry representative bodies must be consulted about the proposed regulations in accordance with section 17:

(i) the consultation has occurred; and

(ii) if, in accordance with that section, such a body makes a recommendation to the Minister about the rate—the rate does not exceed the rate so recommended; and

(b) if a nominated polling body must be consulted about the proposed regulations in accordance with section 17:

(i) the consultation has occurred; and

(ii) if, in accordance with that section, the body makes a recommendation to the Minister about the rate—the rate does not exceed the rate so recommended; and

(c) if neither a nominated industry representative body nor a nominated polling body must be consulted about the proposed regulations:

(i) appropriate consultation has been undertaken about the proposed regulations with bodies and persons involved in the industry in relation to the levy; and

(ii) any recommendations made by those bodies or persons about the rate have been considered.

Note: For consultation requirements generally, see section 17 (consultation) of the Legislation Act 2003.

(3) The fact that consultation referred to in subsection (2) does not occur does not affect the validity or enforceability of the regulations.

Other instruments

(4) The regulations may make provision in relation to a matter by conferring on the Minister or the Secretary a power to make a legislative instrument.

Incorporation of other instruments

(5) Despite subsection 14(2) of the Legislation Act 2003, the regulations may make provision in relation to a matter by applying, adopting or incorporating, with or without modification, any matter contained in an instrument or other writing as in force or existing from time to time.

No limit on subsection (1)

(6) Subsections (4) and (5) do not limit subsection (1).

[Minister’s second reading speech made in—

House of Representatives on 18 October 2023

Senate on 16 November 2023]

(126/23)

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Primary Industries (Services) Levies Act 2024

No. 57, 2024

An Act relating to the imposition of primary industries levies that are neither duties of customs nor duties of excise, and for related purposes

Contents

Part 1—Preliminary

1 Short title

2 Commencement

3 Simplified outline of this Act

4 Definitions

5 Crown to be bound

6 Application of this Act in external Territories

Part 2—Levy on the provision of services that facilitate production of products that are produce of a primary industry

7 Imposition of levy

8 Imposition of 2 or more levies

9 Exemptions from levy

Part 3—Rate of levy

10 Rate of levy

11 Components of levy

12 Flexibility in relation to rates of levy

13 Nil or zero rates

Part 4—Levy payer

14 Levy payer

Part 5—Other matters

15 Act does not impose levy on property of a State

16 Net GST not included in price of service or amount paid for service

17 Nominated industry representative bodies and nominated polling bodies

18 Treatment of partnerships

19 Treatment of trusts

20 Treatment of unincorporated bodies or associations

21 Making of regulations

Primary Industries (Services) Levies Act 2024

No. 57, 2024

An Act relating to the imposition of primary industries levies that are neither duties of customs nor duties of excise, and for related purposes

[Assented to 9 July 2024]

The Parliament of Australia enacts:

Part 1—Preliminary

1 Short title

To understand the scope of the Act, one must unpack several defined statutory terms that delineate what can be taxed. The definition of "produce of a primary industry" under section 4 is extraordinarily broad. It encompasses products resulting from agriculture, cultivation of land, maintenance of animals for commercial purposes, forest operations, fishing, aquaculture, hunting, trapping, harvesting from the wild, horticulture, viticulture, and the cultivation of fungi or algae. It also explicitly covers modern agricultural methods, including soilless growing systems (such as hydroponics, aeroponics, and aquaponics) and controlled environment cropping (such as vertical farming, indoor farming, and protected cropping).

The term "product" is categorised into four streams under section 4: animal products, plant products, fungus products, and algal products. This includes any part of these organisms, anything produced by them, or anything wholly or principally produced or derived from them. This sweeping definition ensures that highly processed derivatives or secondary products remain within the scope of the levy framework.

The concept of a "service that facilitates the production of products" is the core jurisdictional hook of the Act. Under section 7(2), the regulations must require that the service involves the "use or application" of a specified product and is "provided on a commercial basis." This distinguishes commercial agricultural contractors from private or non-commercial operations, ensuring that purely domestic or hobby-farming activities remain outside the tax net.

Another central structural concept is the division of industry consultation through two distinct entities: "nominated industry representative bodies" (s 17(1)) and "nominated polling bodies" (s 17(6)). These bodies are determined by the Minister via legislative instrument. They serve as the formal statutory channels through which the industry can recommend levy rates or rate changes, introducing a regulated lobbying and polling process into the determination of tax liabilities.

The Act directly impacts commercial service providers operating within the Australian primary industries sector. This group includes contract harvesters, shearing contractors, crop-dusting and agricultural aviation operators, artificial insemination and livestock breeding technicians, contract veterinary services, post-harvest processors, and third-party biosecurity or residue testing providers. Any commercial entity whose service "involves the use or application" of an animal, plant, fungus, or algal product to facilitate production may find its activities declared a "specified service" under future regulations.

Primary producers, including traditional farmers, aquaculturalists, foresters, and indoor vertical farmers, are heavily affected. Although they may not be the legally designated "levy payers" under section 14, they will bear the economic incidence of the levy as service providers increase contract prices to cover their tax liability and compliance costs.

The Act also directly affects industry representative organisations and polling bodies. Once designated under section 17, these bodies assume statutory consultation rights and administrative duties, including the obligation to conduct formal polls of service providers and producers before recommending levy rates to the Minister.

Furthermore, professional advisers, including accountants, tax agents, and commercial lawyers, are affected. They must grapple with the complex joint and several liability provisions that apply when these services are delivered through common agricultural structures, such as partnerships, trusts, and unincorporated associations.

Finally, the Crown in right of each State, the Australian Capital Territory, and the Northern Territory is bound by the Act (s 5). This means state-owned forestry or agricultural corporations providing commercial services may be captured, subject to the constitutional limitations on taxing state property set out in section 15.

The primary duty established under the Act is the liability to pay the levy. Section 14 dictates that the levy is payable by the person "worked out in accordance with the regulations." The rate of the levy must be calculated in accordance with the regulations (s 10) and may consist of a single component or the sum of multiple components (s 11). The regulations are given the flexibility to set different rates for different classes of services (s 12) or to set rates at "nil" or "zero" (s 13), which is a common regulatory technique used to keep a tax mechanism in place while temporarily suspending collections.

Nominated industry representative bodies and nominated polling bodies possess specific statutory rights and duties under section 17. If the Minister determines a body to be a nominated industry representative body, that body has the right to be consulted and to make recommendations regarding the setting or amending of the levy rate (s 17(2)). However, this right is coupled with a duty: under section 17(4), the representative body must consult with other specified bodies before making its recommendation to the Minister.

Nominated polling bodies have a similar right to be consulted (s 17(7)), but are subject to a strict statutory duty under section 17(9). Before making a recommendation to the Minister on levy rates, the polling body must ensure a poll is conducted in accordance with requirements specified by the Minister. Crucially, any recommendation made by the polling body must be in accordance with the results of that poll.

For the executive, the Minister is subject to a duty under section 21(2) to ensure that the required consultations have occurred and that the proposed levy rate does not exceed the rate recommended by the nominated representative or polling bodies. If no such bodies exist, the Minister is bound by a duty to undertake "appropriate consultation" with industry participants and consider their recommendations (s 21(2)(c)).

A striking feature of the Primary Industries (Services) Levies Act 2024 is the total absence of civil penalties, criminal offences, or collection mechanisms within its text. This absence is a deliberate consequence of Australian constitutional drafting conventions.

Under section 55 of the Constitution, laws imposing taxation must deal only with the imposition of the tax; any other matter contained therein is of no effect. To avoid invalidity, the Commonwealth splits its tax regimes into separate packages: an "imposition" Act (which this Act is) and a "collection/administration" Act.

Consequently, the enforcement tools, late payment penalties, audit powers, record-keeping requirements, and criminal penalties for non-compliance are not found within this Act. They will be housed in a separate, companion collection statute or prescribed via general administrative regulations under section 21(1) to the extent permissible.

However, the Act does establish the baseline statutory liability that underpins enforcement. It accomplishes this by modifying how liability is distributed across common business structures. Under section 18, if a partnership is liable to pay a levy, the obligation is imposed on each partner individually, though it can be discharged by any of them. Similarly, under section 19, obligations fell upon a single trustee or jointly and severally upon multiple trustees. Under section 20, obligations are imposed on each member of an unincorporated association’s committee of management. These provisions ensure that the Commonwealth can pursue individual partners, trustees, or committee members for the full amount of any unpaid levy, transforming what would otherwise be corporate or entity-level debts into personal liabilities.

The Act is designed to operate within a specific web of constitutional and statutory frameworks. Constitutionally, section 7(4) explicitly states that the Act authorises the imposition of a levy only so far as it is neither a duty of customs nor a duty of excise within the meaning of section 55 of the Constitution. This is a critical defensive drafting measure. Because the states have exclusive power over certain taxes and the Commonwealth has exclusive power over customs and excise, the levy must be legally characterised as a fee or a general tax on services, rather than a tax on the manufacture or production of goods (excise) or a tax on importation (customs).

Similarly, section 15 addresses section 114 of the Constitution, which prohibits the Commonwealth from imposing a tax on property of any kind belonging to a State. Section 15(3) extends this constitutional protection to the Australian Capital Territory and the Northern Territory, ensuring that the levy cannot be applied to territory-owned or state-owned property, though it can apply to services provided by or to those entities where property is not the subject of the tax.

The Act also directly overrides a core provision of the GST regime. Section 16 states that, despite section 177-12 of the A New Tax System (Goods and Services Tax) Act 1999, any reference in the regulations to the "price" or "amount paid" for a service is taken to exclude the net GST. This ensures that the levy is calculated purely on the base value of the commercial service, preventing "tax on tax" compounding effects.

Additionally, section 21(5) explicitly overrides subsection 14(2) of the Legislation Act 2003. This allows the regulations to adopt or incorporate external instruments or writings "as in force or existing from time to time." This represents a substantial expansion of executive power, enabling the technical standards or industry codes that define taxable services to change dynamically without requiring legislative amendment or a new disallowable instrument.

The Primary Industries (Services) Levies Act 2024 is a new principal Act. It was enacted as Act No. 57 of 2024. The bill was originally introduced into the House of Representatives on 18 October 2023 and subsequently introduced into the Senate on 16 November 2023.

The Parliament passed the bill, and it received Royal Assent on 9 July 2024. As set out in the commencement table in section 2(1), the entire Act commenced operation on 1 January 2025.

Because the Act only recently commenced, it has no prior history of legislative amendments. Any future changes to the rate structures, definitions, or scope of the levies will be executed primarily through amendments to the regulations made under section 21, or via ministerial instruments determining nominated bodies under section 17, rather than direct amendments to this primary Act. Researchers and practitioners must therefore monitor the Federal Register of Legislation for subordinate legislative instruments rather than relying solely on the text of this Act.

As of its commencement on 1 January 2025, there has been no reported litigation or judicial consideration of the Primary Industries (Services) Levies Act 2024. However, the constitutional boundaries referenced within the Act suggest several areas where litigation may emerge as specific levies are rolled out.

The primary constitutional risk lies in the characterisation of the levy under section 55 of the Constitution. If the regulations impose a levy on a service that is so closely connected to the production process of a primary product that it is judicially characterised as a tax on the steps of production, litigants may argue that the levy is, in substance, a duty of excise. If a court agrees that the levy is an excise, the regulations would be constitutionally invalid under section 7(4).

Similarly, the boundary between a "service" and "property" under section 114 of the Constitution remains a potential flashpoint. If the regulations attempt to levy services provided by state forestries or state-owned water authorities, state governments may challenge the levy on the basis that it operates as an unlawful tax on state property.

Historically, primary industries levies in Australia have attracted litigation regarding whether the consultation processes required by statute were genuinely observed. However, as analyzed below, the draftspersons of this Act have included robust statutory protections to insulate the regulations from being struck down on the grounds of administrative procedural failures.

The most significant legal "gotcha" for industry stakeholders is found in section 21(3), which contains a sweeping consultation exclusion clause: "The fact that consultation referred to in subsection (2) does not occur does not affect the validity or enforceability of the regulations."

While section 21(2) sets out elaborate consultation requirements, including checking that the Minister is satisfied that nominated representative and polling bodies have been consulted and that the levy rate does not exceed their recommendations, section 21(3) completely immunises the resulting regulations from judicial review on those grounds. If a Minister completely ignores the nominated representative body, fails to consult the industry, or sets a rate higher than recommended, the regulations remain completely valid and enforceable. This significantly undermines the practical leverage of industry bodies and leaves affected service providers with political rather than legal remedies.

Another critical trap lies in the personal liability provisions for partners, trustees, and committee members under sections 18, 19, and 20. In many agricultural businesses, family members or passive investors are appointed as trustees or partners in a partnership. Under section 18(2), an obligation imposed on a partnership is "imposed on each partner instead." This means a passive partner with no operational role in a contract harvesting business can be personally targeted by the Commonwealth for unpaid service levies. The same applies to individual trustees under section 19(3) and members of an unincorporated association's management committee under section 20(2).

Furthermore, the definition of a service that "facilitates" production in section 7(1) is highly elastic. The Act does not define "facilitates." This term could be interpreted to capture distant auxiliary services, such as software-as-a-service (SaaS) platforms used for agricultural mapping, drone telemetry services, or independent agronomic advisory services, significantly expanding the tax net beyond physical, on-farm contract labor.

For commercial operators and their professional advisers, compliance requires a systematic, multi-step monitoring and accounting strategy.

First, because this Act is an empty framework, compliance cannot be determined by reading the Act alone. Compliance professionals must establish a regulatory monitoring system to track all regulations made under the Act and all ministerial legislative instruments issued under section 17. Once a specific service is "specified" in the regulations, the provider must identify whether they meet the definition of a "levy payer" under that specific regulation.

Second, accounting systems must be configured to handle the GST-exclusive calculation required by section 16. When calculating the levy liability, the billing system must isolate the gross price charged for the service, subtract the net GST component, and then apply the levy rate (whether a flat rate, a percentage, or a formula under sections 10 and 11) to the GST-exclusive baseline. Mixing the GST and levy calculations will result in overpayment or underpayment, both of which carry compliance risks under companion administration laws.

Third, agricultural businesses must review their legal structures. If services are provided via a partnership, trust, or unincorporated association, the entity should:

Update its partnership agreements, trust deeds, or association rules to include explicit indemnity clauses. These clauses must protect individual partners, trustees, or committee members who may be held personally liable under sections 18, 19, or 20.
Ensure clear internal delegation of authority, allowing a designated partner or trustee to discharge the levy obligations on behalf of the entire entity, as permitted by sections 18(3) and 19(3)(b).

Finally, industry groups and service providers should actively participate in the designation of nominated representative or polling bodies. If your industry is targeted for a levy, ensure your organization lobbies for recognition under section 17(1) or 17(6). If a poll is triggered under section 17(9), providers must ensure they are registered to vote, as the polling results are one of the few mechanisms that legally constrain the rate recommendations made to the Minister.

Primary Industries (Services) Levies Act 2024

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