The federal government has tightened a tariff duty concession for major projects that import capital goods into Australia instead of using local content.
The federal government has tightened a tariff duty concession for major projects that import capital goods into Australia instead of using local content.
The Enhanced Project By-law Scheme is designed to assist projects that are unable to source capital equipment within Australia at a competitive price or at the necessary quality.
In practice, the scheme has been contentious, with local manufacturers sometimes arguing that project developers do not make sufficient effort to identify or support local suppliers.
The changes follow a trend for complex process plants, such as the gas processing plants for the Pluto and Gorgon LNG projects, to be built in modular form in Asian construction yards rather than on-site.
Innovation Minister Senator Kim Carr said the changes tighten the definition of what goods will be considered for duty free entry.
"It will be made clear that it is not possible to receive concessions for whole projects or complex plants," he said in a statement.
Senator Carr said that in 2007-08, the value of investment in projects applying for an EPBS duty concession totalled $38 billion. In the following two years, it jumped to $42 billion and $56 billion.
"The changes are part of the Rudd Government's $19.1 million Australian industry participation package, giving Australian industry and workers a fairer go at winning government and private sector contracts.
"It is about giving Australian businesses the best chance of getting in the game, and the best chance of winning - supporting jobs for workers and growth for industry.
"We have consulted extensively with industry and tightened the guidelines to emphasise our focus on improving opportunity for Australian industry participation, and to clarify the scope of goods for which a duty concession can be claimed."
Senator Carr said companies applying for a concession must satisfy a number of criteria, inclkudng suitable evidence of non-availability of eligible goods from Australian producers.
Full statement below:
FURTHER BOOST FOR AUSTRALIAN INDUSTRY PARTICIPATION
Australian businesses will have more opportunities to participate in major projects at home and abroad thanks to changes to guidelines announced today.
The revised guidelines for the Government's Enhanced Project By-law Scheme (EPBS) will ensure Australian businesses, especially small and medium enterprises, using the scheme will get the maximum possible benefit from it.
The EPBS provides tariff duty concessions on eligible capital goods for major investment projects across different industries.
Innovation Minister Senator Kim Carr said the changes are part of the Rudd Government's $19.1 million Australian industry participation package, giving Australian industry and workers a fairer go at winning government and private sector contracts.
"The changes clarify requirements for projects accessing the scheme, allowing more Australian businesses to be involved in major domestic and international projects," Senator Carr said.
"It is about giving Australian businesses the best chance of getting in the game, and the best chance of winning - supporting jobs for workers and growth for industry.
"We have consulted extensively with industry and tightened the guidelines to emphasise our focus on improving opportunity for Australian industry participation, and to clarify the scope of goods for which a duty concession can be claimed.
"The changes tighten the definition of what goods will be considered for duty free entry. It will be made clear that it is not possible to receive concessions for whole projects or complex plants.
"In 2007-08, the value of investment in projects applying for an EPBS duty concession totalled $38 billion. In the following two years, it jumped to $42 billion and $56 billion."
Companies applying for a concession must satisfy a number of criteria. These include: implementing an Australian Industry Participation (AIP) plan that gives Australian industry full, fair and reasonable opportunity to participate in the project; investing in projects which fall within an eligible industry sector; meeting the eligible goods expenditure threshold; and providing suitable evidence of non-availability of eligible goods from Australian producers.
"Having an approved AIP plan in place before major procurement begins is a significant requirement of the guidelines. It offers all Australian businesses the opportunity to be involved in major domestic and international projects, and global supply chains," Senator Carr said.
Information sessions on the new guidelines and transitional arrangements will start next month and be held in Perth, Adelaide, Melbourne, Sydney and Brisbane. For more information on the scheme or details on how to register for the information sessions, visit www.ausindustry.gov.au,
