Australian government to cut 500 'nuisance' tariffs

Canberra, Aug 28 (IANS) The Australian government on Thursday said that it will cut another 500 "nuisance" tariffs as part of a push to boost productivity and encourage free trade.

Treasurer Jim Chalmers, Trade Minister Don Farrell and Industry and Innovation Minister Tim Ayres on Thursday announced that the small tariffs on items including tyres, wine glasses and televisions will be removed from the start of the next financial year on July 1, 2026, to reduce the compliance burden on businesses, Xinhua News Agency reported.

Chalmers told reporters in Canberra that the nuisance tariffs "often do more than good". He said that current tariffs on tyres raise less than 80,000 Australian dollars (52,109.8 US dollars) in revenue every year, but that removing them will save businesses more than 32 million AUD (20.8 million USD) in compliance costs annually.

"We are putting our money where our mouth is," Farrell said, adding, "We want countries to remove trade barriers. We are demonstrating to the rest of the world we are serious about this issue."

The government in 2024 abolished 457 nuisance tariffs on items including certain vegetables, refrigerators and rubber.

The further cuts were proposed during the government's economic reform roundtable, which brought together business groups, trade unions and economists earlier in August to discuss ideas to stimulate Australia's stagnating economic productivity.

Chalmers said that the treasury will consult on the proposed tariffs to be cut by December, and the final agreed list will be published in the next federal budget, which he is expected to hand down in May 2026.

Meanwhile, Australia's annual rate of inflation hit a 12-month high of 2.8 per cent in July, according to official data published on Wednesday.

The Australian Bureau of Statistics (ABS) said that the consumer price index (CPI) rose by 2.8 per cent in the 12 months to the end of July 2025, up from 1.9 per cent in the year to June.

It marks Australia's highest rate of annual inflation since the 12-month period to July 2024, when the CPI rose by 3.5 per cent.

The Australian Broadcasting Corporation reported that economists had expected the CPI to rise by about 2.3 per cent in the year to July.

The annual trimmed mean, a measure of underlying inflation, also rose from 2.1 per cent in June to 2.7 per cent in July.

According to the ABS, the biggest drivers of CPI growth in the year to July were a 3.6 percent rise in housing costs, a 3.0 percent rise in food and non-alcoholic beverage prices, and alcohol and tobacco prices, which rose by 6.5 percent.

Coffee, tea, and cocoa prices were 14.4 per cent higher in July than 12 months earlier.

"This comes as supply has been affected by adverse weather conditions impacting major overseas coffee bean-growing areas," Michelle Marquardt, ABS head of prices statistics, said in a statement.

The Reserve Bank of Australia, the country's central bank, said in forecasts released earlier in August that it expected headline inflation to increase over the second half of 2025 before stabilising at around 3 per cent through most of 2026.

--IANS

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