Fed: Coca-Cola warns against sugar levy
By Nikki Todd
BRISBANE, Aug 22 AAP - Australia's largest sugar user, soft drink manufacturer Coca-ColaAmatil, today warned against a government levy on sugar.
The company's comments are in direct opposition to canegrowers who said a levy shouldbe imposed not just on domestic sugar but also on imported manufactured sugar goods.
Their response followed the first indication by Prime Minister John Howard that hisgovernment was considering a rescue package for the industry, which is struggling underlow world prices, disease problems and drought.
However, Mr Howard warned some canegrowers would have to leave the industry as partof restructuring recommended by the recent Hildebrand Report.
Referring to the same report, Coca-Cola Amatil group corporate affairs manager AlecWagstaff said while not much detail was yet known, a levy could double the price of domesticraw sugar, driving users to overseas markets.
"According to the Hildebrand Report, this sort of a levy would only drive users toimport sugar which we wouldn't want to do," Mr Wagstaff told AAP.
"Any increase in price would have to be passed on to consumers so it becomes a costissue in the food industry."
Mr Wagstaff said Coca-Cola Amatil was "by far" the greatest sugar consumer, producing1.6 billion litres of soft drink a year and generating $1.67 billion in revenue.
Such revenue was in stark contrast to the crisis currently being experienced by farmers.
Lester Paul, a Mackay farmer of 27 years, said it was about time the government respondedto calls for a levy.
"The sugar industry is on its knees - it is finished," Mr Paul said.
"We don't want money off the government, we want sustainability for the industry.
"We want a levy on anything that's got sugar in it ... including manufactured productscoming in to Australia, not just sugar imports."
Mr Paul said his farm, which produces up to 40,000 tonnes annually, had been hit bydisease last year, causing the cost of production to exceed earnings by $15 a tonne.
He said farmers would seek further assistance from the Queensland government, callingfor a moratorium on the increase of water and power costs.
Canegrowers Association chairman Jim Pedersen said the imposition of a levy was oneof 18 proposals submitted by his organisation to the Hildebrand inquiry.
"A consumption levy would not place a great burden on the public purse," Mr Pedersen said.
However, he was alarmed such a levy might come at the expense of small-time producersas alluded to by Mr Howard.
The industry has called for a $150 million rescue package, but the government is hesitantto hand over such a large sum just two years after providing $60 million in assistance.
AAP nt/sc/dl/sb
KEYWORD: SUGAR NIGHTLEAD
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