We’d like to advise industry that a Heavy Engineering Research Levy Act Amendment Order 2021 was signed by the Governer-General on 5 July and published 8 July.
This has been something that we have been working on with the MBIE innovation policy team and Customs for quite some time. MBIE’s role has been to coordinate the Cabinet and legislative process, while Customs will be responsible for the operational implementation of the Act.
The order replaces Schedules 2 and 3 of the Act, and will come into force on 26 August 2021. It details changes to levy rates and levied items. Customs Operations will now start preparing the updates for Customs’ systems to allow them to collect the relevant levies.
What does this mean for our members and industry?
Back in 2017, there was a change to the statistical reporting codes to some of the tariff items covered in the HERL Act. This change meant that the Act no longer covered some items that the Act was intended to, and historically, did cover.
As a result HERA has missed out on levy collections for these items (mainly RHS categories), and the industry as a whole has missed out on investment exceeding $300K into heavy engineering support.
The legislative changes fix this administrative issue so that the levy can again be collected on these items and invested, through HERA, into industry support.
HERA has also worked with MBIE and Customs to put in place measures to ensure this type of error does not occur again.
To note, there is also an amendment up for review for levy collected on prefabricated items. It is a different process to this one, and will be reviewed in 2022.