Consumer Information - Dairy Adjustment Levy Termination
Australian Government Minister for Agriculture, Fisheries and Forestry, the Hon. Tony Burke MP, has announced the Dairy Adjustment Levy termination day will be 22 February 2009.
What is the Dairy Adjustment Levy?
The Dairy Adjustment Levy is an 11 cent levy paid by consumers on each litre of drinking milk they buy. Proceeds from the levy are used to fund the Dairy Industry Adjustment Program, which was introduced in 2000 to help dairy farmers, their families and dairy dependant communities adjust to a deregulated market.
The levy generates about $20 million a month and will have raised about $2 billion when the final levies are collected in February 2009.
Does the removal of the levy affect milk consumers?
The Australian Government expects the reduced cost of milk to be passed on to consumers, and accordingly, people should be paying 11 cents a litre less for their milk shortly after the levy is removed.
Any complaints or suggestions of anti-competitive conduct in relation to removal of the levy should be directed to the Australian Competition and Consumer Commission.
The price reduction may not be immediately obvious because the shelf life of drinking milk is around 10 days, and as a result it could take up to 10 days for the retail price of milk to reflect the removal of the levy. Retailers can continue to recover the milk levy cost in the retail price until the supply of milk they bought before 23 February is exhausted.
Further information
The Australian Competition and Consumer Commission can be contacted on 1300 302 502 or at www.accc.gov.au.