Abbott set to increase subsidies for freight from Tasmania

Prime Minister Tony Abbott looks set to announce an increase in funding for the Tasmanian Freight Equalisation Scheme today.

As the ABC reports, Abbott is expected to increase funding for the scheme by $203 million over four years. The scheme currently costs about $95 million a year, so this represents an increase of more than 40 per cent.

Currently many goods are not eligible for the scheme and, significantly, neither are most goods which are sent to Melbourne en route for eventual overseas export.

"If you send a container to Melbourne, you get the subsidy; if you send it to Melbourne and then somewhere overseas, you don't get the subsidy," Industry Minister Ian Macfarlane told the ABC.

"We'll be looking at how we can address that."

According to the Hobart Mercury, exporters will be able to claim $700 a container from New Year ’s Day next year.

However, it is not yet clear if goods going directly to Asia would be eligible for the $700 subsidy.

Currently about 10,000 claims from 1300 individuals are made each year under the Tasmanian Freight Equalisation Scheme.

Abbott said the current cost of freight is a handicap for the Tasmanian economy.

“Unlike their counterparts in other parts of Australia, Tasmanian businesses can’t transport their goods interstate by road or rail. This announcement means more people in more markets will get to see, try and buy Tasmania’s wonderful products.”

In recent times, Tasmanian industry figures have been vocal in their calls for moves to ease the freight costs for Tasmanian businesses.

They have been supported by Tasmanian federal politicians, such as independents Senator Jacqui Lambie and MP Andrew Wilkie.

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