jAU STRALI
PRIME MINISTER Press Statement ' No. 177
23 January 1974
TARIFFS ON DOMESTIC APPLIANCES
' he Prime Minister, Mr. Whitlam, today announced
details of the Government's acceptance, with minor variations,
of the report of the Tariff Baord ( now Industries Assistance
Commission) on domestic appliances, heating and cooling
equipment, etc.
Mr. Whitlam said that in general, the Tariff Board
has recommended a tariff duty of 25% for the goods under reference.
However, there are several exceptions to this whereby some products
will be subject to a duty of 20 per cent and others 35 per cent.
Generally, these recommendations provide for the existing tariff
rates for a number of goods to be reduced significantly. The
Board has stated that evidence supplied by local manufacturers
and other information indicate that major economies could be
achieved by re-organising production activities. These economies
( coupled in many cases with substantial natural advantages) would
allow the industries to operate profitably and probably to command
a larger market under reduced levels of protection. More efficient
production would also provide substantial national benefits.
Because the protective situation which applied until
recently offered few inducements to change, the Board has recommended
duty levels designed to encourage a better use of-resources while
providing adequate protection for the more efficient producers.
The better use of resources and the lower levels of protection should
bring * siqnifi cantly reduced prices to consumers ( including most home
owners) as well as general economic benefits to the community as a
whole. Mr. Whitlam indicated that the industries covered by this
report include the second major consumer products sector of the
economy to be reviewed recently by the Government. ( The first
was the consumer electronic equipment and components industry.) / 2
-2-
Goods covered by this latest report are wide ranging and
are of major importance to Australian consumers in that many are
now ' necessities' and constitute substantial investments for
most Australian home owners. They include refrigerators, washing
machines, clothes dryers, freezers, dish washing machines, ranges
ovens, and small stoves ( commonly referred to as whitegoods);
certain refrigeration components, air conditioners and commercial
refrigeration; portable appliances such as toasters, irons, kettles,
etc., and water heaters and space heaters.
The Government has decided not to accept the precise
recommendations of the Tariff Board in respect of a suggested deferral
of some duty reductions for two years. Instead, it has decided to
phase-in the duty reductions over the two year period, beginning with
an immediate reduction and further reductions in 12 months and 2 years
hence. This will enable firms to be subjected to a more gradual
increase in competitive pressures and encourage them to undertake
the necessary re-organisation at an early date. The present high
level of consumer demand both here and overseas and the resultant
pressure for higher levels of production will ease adjustments in
the industry. The Government has accepted the Board's recommendation
that a bounty be paid on the production and sale in Australia of
sealed compressors of 1.5kw or less because of the importance
of compressors as components in the manufacture of refriger'ators
and room air conditioners. The payment of bounty will provide local
regrigerator and air conditioner manufacturers with the immediate
advantage of lower prices for an important component and thereby
assist them to prepare for the reduced level of protection on their
appliances. Mr. Whitlam said that details of the customs tariff changes
arising from the Government's decision will be announced when
administrative arrangements to implement them have been finalised.
In accepting the Tariff Board's recoupindatkons, the
Government has decided that assistance will be made available to
firms and employees who may be disadvantaged by the proposed tariff
changes. Details of assistance and eligibility will be announced
after the completion of the Government's general consideration of
adjustment assistance principles. If necessary, interim assistance
arrangements will be implemented.
CANBERRA. A. C. T.