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Regulation impact statement - Review of the low value turnover annual charge exemption scheme
The low value turnover (LVT) scheme will be replaced by the Annual Charge Exemption (ACE) scheme on 1 July 2015. For information on the new ACE scheme, including the transitional arrangements in place for entries previously granted LVT exemptions, see: ACE Scheme.
This Regulation Impact Statement, prepared by the TGA in March 2015, documents a proposal to introduce a new annual charge exemption scheme to replace the low value turnover (LVT) exemption scheme which has been in place since 1990.
The TGA has explored options to replace or remove the LVT scheme, in consultation with industry, as it no longer meets its intended objectives, is inconsistent with the Australian Government Cost Recovery Guidelines and imposes a significant red tape burden on both industry and the TGA.
The proposed new annual charge exemption (ACE) scheme is designed to provide better equity and transparency, simplify participation requirements, and reduce regulatory red tape for business.
The RIS summarises the current LVT scheme and its associated problems, discusses why action is needed and details what options are being considered. The RIS also details the consultation process that was undertaken with stakeholders to determine the best option for redesigning, or removing, the scheme. The document then outlines the best option from those considered and discusses the proposed implementation of a new annual charge exemption scheme.
The key benefits of the proposed ACE scheme are:
- No application fee is required
- Automatic exemption upon entry in the ARTG until turnover commences
- Self-declaration (no third party accountant certification)
- Online self service
- Annual charge invoices will not be issued for exempt entries, saving significant administrative overhead for sponsors and TGA
- New waiver option for annual charges on the basis of public health risk
- Greater equity, transparency, and significant red tape reduction
|Version||Description of change||Author||Effective date|
|V1.0||Original Publication||Regulatory Decision Review Section
Regulatory Business Services Branch
|26 March 2015|